Latest news with #Centrica
New Statesman
13 hours ago
- Business
- New Statesman
Energy storage must not be overlooked on the road to net zero
Photo courtesy of Centrica Cliché dictates that us Brits love nothing more than talking about the weather. But weather's role in our lives is shifting. No longer just a great conversation starter, we're becoming increasingly reliant on it for powering our homes, businesses, transportation and heating. Over the last 12 months, renewable energy in the form of solar and wind power has combined to provide about a third of our electricity. Nuclear gives us 15 per cent, biomass and hydroelectric a further 8 per cent, and we import around 14 per cent from our European neighbours. The remaining 30 per cent comes from natural gas – almost exactly the same as from renewables. Gas is what keeps the lights on when the wind doesn't blow and the sun doesn't shine. It's what keeps over 90 per cent of UK homes warm during the winter. Unfortunately, it is not as simple as doing away with gas quickly. Instead, we must find ways to decarbonise gas, because it will remain a crucial energy source for the UK for decades to come. Too much of the energy debate has become polarised: gas versus renewables; hydrogen boilers versus heat pumps; affordability versus decarbonisation; right versus left. There is a lot of energy in the debate, but way more heat than light. A net zero energy system must be affordable, secure, and sustainable. If we miss any of these three outcomes, we will have failed. Centrica's Rough gas storage asset, 18 miles off the coast of Yorkshire, is at the heart of UK energy security – providing half of the UK's gas storage capacity. Without this storage buffer the UK is subject to far greater price volatility, unnecessarily pushing up consumer bills. Our nearest European neighbours, many of which have ten-times the UK's gas storage capacity, are actively filling gas stores for the coming winter. As it stands the UK will go into the winter with significantly less gas in storage than over the last few years, leaving us at the mercy of global gas market price spikes – precisely the thing we are trying to avoid as a country. An FTI study found that had Rough operated at full capacity it would have saved UK consumers over £5bn in an 18-month period over the peak of the energy crisis. £100 off annual energy bills, or a third of the government's promised £300 energy bill savings. Since 2022, we've stressed the need for the existing regulatory support model used for infrastructure providing critical energy security to the UK such as interconnectors with Europe, to be extended to include Rough. It is a vital energy store for the UK, the biggest we have, and such a move would allow us to continue operating it for the long term. Chris O'Shea: 'A net zero energy system must be affordable, secure, and sustainable.' (Photo courtesy of Centrica.) At Centrica we are ready to invest £2bn of our own money in Rough, securing existing jobs in the North Sea and creating thousands of new well-paid jobs in both the construction phase and in the supply chain. A redeveloped Rough will reduce the UK's exposure to short term swings in global gas prices and increase the UK's energy security and resilience, underpinning the economy. We have the cash in the bank – and we're itching to get going. But without a regulatory model we can't sign off such an investment. This isn't about taxpayer cash and it's not asking for anything new. This is about a level playing field for energy infrastructure, so as the government pushes hard to deliver growth, companies like Centrica can invest billions of pounds in the UK to help deliver energy and price security for homes and businesses. Unlocking the redevelopment we're proposing isn't just a short-term play. Alongside the ability to store natural gas, we'll also develop the potential for hydrogen storage in the future. I'm convinced that the UK has all of the ingredients – the skills, the weather, decades of North Sea experience – to be a global leader in the hydrogen economy. This would allow us to control our energy destiny, and to once again feel the benefits of being a net energy exporter. Rough is not a silver bullet for energy security, but it plays a critical role in increasing capacity and supply confidence in an uncertain world. We must learn from the mistakes of the past and get Rough ready to play a long-term role as the UK's energy safety net. That way, regardless of the weather, the outlook will be bright. Subscribe to The New Statesman today from only £8.99 per month Subscribe Related
Telegraph
11-06-2025
- Business
- Telegraph
Cost of Miliband's nuclear plant doubles to more than £40bn
The cost of the Sizewell C nuclear power plant has doubled to more than £40bn as ministers race to strike a funding deal with private investors and the French government. An official cost estimate for the scheme in Suffolk, which would generate enough electricity for 6m homes, was previously put at £20bn. But that has grown to £30bn at constant prices – or £41bn in today's money – with the Government set to shoulder at least half of the upfront cost, according to industry and Whitehall sources. The entire scheme will ultimately be paid for by households and businesses via their electricity bills, including through levies that will begin during construction. The power plant's rising price tag will trigger concerns about future increases as Hinkley Point C, a nuclear development in Somerset, has repeatedly overrun budgets and timescales. On Wednesday, Rachel Reeves, the Chancellor, underlined Labour's commitment to the mega project, arguing that she and Ed Miliband, the Energy Secretary, believed pushing ahead was 'the right choice for bills, the right choice for jobs and the right choice for growth'. As part of the spending review, Ms Reeves confirmed £14bn of funding for Sizewell C through 2029 – taking the Government's total promised investment to more than £17bn. The rest will come from a group of private investors, potentially including British Gas owner Centrica, as well as French state nuclear company EDF, which will build and part-own the plant. EDF is expected to put in up to £2bn of extra cash, enough to secure a stake of about 20pc. That will require sign-off at the highest levels, including from the company's board and the Elysée Palace. One potential investor suggested EDF would probably maintain a stake of at least 10pc to ensure market confidence. The company will also benefit from the deal through billions of pounds worth of equipment orders. However, the politics of backing the British plant are complicated in France, where critics believe EDF is already over-exposed to Hinkley Point C and want the state company to focus on projects at home. 'I am sure the French government will try to get something in return for agreeing to put a bit more money in,' the investor added. A final funding deal is expected to be signed off at an Anglo-French summit next month. Other potential investors in the frame include Amber Infrastructure Partners, Brookfield Asset Management and the Canadian pension fund CDPQ – run by former John Lewis boss Dame Sharon White in the UK. On Wednesday, the Government refused to comment on Sizewell C's cost. Whitehall sources insisted that the estimate had not 'doubled', but did not provide further information. Sources close to the process have told the Telegraph that the project is expected to cost £30bn in 2015 prices. This is an increase of 50pc compared with the original £20bn estimate. But the figure rises to £41bn when adjusted for inflation. The £30bn total includes about £10bn in equity that will be raised from investors and another £20bn of debt. 'Learning curve' It means that, on a like-for-like basis, the project is on course to be cheaper than Hinkley Point C, which uses a near-identical design. Hinkley is expected to cost £31bn to £34bn in 2015 prices, according to EDF. The lower cost of Sizewell is due to 'learning curve' efficiencies, with supply chains and skilled workers set to be carried over from Hinkley. But despite this, and the money committed by Ms Reeves, the Government has so far refused to officially confirm what it expects the project to cost in total. Alison Downes, of the Stop Sizewell C campaign group, said: 'Given negotiations with private investors are incomplete, Sizewell C really should be excluded from Wednesday's announcements. 'Where is the good news in a project that will cost tens of billions, add to consumer bills and is guaranteed to be late and overspent?' A spokesman for the Department for Energy Security and Net Zero said: 'Hinkley was built after decades of no new nuclear. 'We are filling the gap with a new nuclear programme which will see greater efficiencies and learnings carried across projects. 'Sizewell C will be an almost exact replica of Hinkley Point C – but crucially learning from previous mistakes and replication. 'EDF says that the second unit of Hinkley is getting built at a rate 25pc quicker than the first, and Sizewell C is effectively a third and fourth version of this reactor.'
Yahoo
11-06-2025
- Business
- Yahoo
SINGLETON BIRCH, MLC AND CENTRICA REACH FUNDING MILESTONE FOR PRODUCING LOW-CARBON LIME USING HYDROGEN
NORTH LINCOLNSHIRE, England, June 11, 2025 /PRNewswire/ -- Singleton Birch, an MLC company, has partnered with Centrica Energy Storage Ltd to produce hydrogen fuel for low-carbon lime at its North Lincolnshire operation. The UK Department for Energy Security and Net Zero has shortlisted the project for funding under the Hydrogen Allocation Round 2 (HAR2) initiative. Singleton Birch is part of MLC, an international provider of lime-based products, technical services and solutions. The MLC and Singleton Birch teams are developing shared investment strategies to reduce the environmental impact of producing lime, an essential mineral for many industries. "The UK funding supplements our investment to help us achieve our vision for this project, advancing progress toward our climate targets by cutting carbon emissions, reducing natural gas dependence and securing a reliable source of green energy. We're also evaluating its feasibility as a solution to leverage at other operations," said Fiona Woody, director of ESG and sustainability at MLC. Centrica will construct the hydrogen plant at Singleton Birch for commissioning in 2028. The plant will convert water into hydrogen and oxygen through electrolysis, providing 20% of the energy needed to fuel Singleton Birch's lime kilns, reducing natural gas consumption. HAR2 is a funding initiative to support low-carbon hydrogen production across the UK. According to the Department for Energy Security and Net Zero, investment in hydrogen will enable decarbonisation of vital industries, economic growth, energy security and new jobs. "Carbon neutrality will require not only our own commitment to new strategies, but also new technologies, supportive legislation and appropriate infrastructure. Our partnership with Centrica and support from the UK government will help us to achieve ambitious goals for reducing our climate impact," said Edward Arnott, technical director at Singleton Birch. MLC has invested hundreds of millions of US dollars within the past several years on projects that reduce emissions, energy consumption and waste, as well as enhancing fuel flexibility and efficiency. At Singleton Birch, the company recently allocated capital to develop an eco-park to restore previously quarried land for beneficial use and is the proposed location for the hydrogen facility. Singleton Birch also made upgrades to its three anaerobic digesters, which provide renewable, bio-based energy for its own operations and the local electrical grid. Considering what's next, Woody explained that another promising area the company is evaluating is carbon capture. A separate MLC project to evaluate carbon-capture technologies was selected for negotiations by the US Department of Energy earlier this year and could provide learnings that could be leveraged internationally. View original content to download multimedia: SOURCE MLC Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
08-06-2025
- Business
- Yahoo
Raise taxes to bring down energy bills, British Gas boss tells Reeves
The boss of British Gas owner Centrica has urged Rachel Reeves to raise taxes to bring down energy bills. Chris O'Shea said the Chancellor must act to prevent hard-up households from shouldering the cost of Ed Miliband's net zero transition. In particular, he signalled that Centrica would support plans to shift green levies from household bills to general taxation. Speaking on BBC Radio 4's Broadcasting House, he said: 'The cost of the energy transition is not small. 'It's not because renewables are expensive, it's just because we have an energy system that was designed for a world that no longer exists, so we're having to upgrade the energy system and that requires a quite substantial investment. 'At the moment, the costs for doing that come off consumer bills. There is an option to put that on general taxation and that's something that we would support at Centrica.' Mr O'Shea acknowledged that the Chancellor was facing significant financial pressures, especially ahead of the upcoming spending review. However, he said: 'The reality is that we as a country have to pay for the upgrade of the energy infrastructure, either through bills or through general taxation.' His comments come amid mounting scrutiny over so-called green levies, which are charges added to household energy bills to help fund renewables such as wind and solar. These are seen as key to supporting Mr Miliband's target of reaching net zero by 2050. However, critics have accused the Energy Secretary of failing to tackle sky-high energy bills. The Climate Change Committee, which advises the Government on its emissions targets, has said that green levies should be removed from household costs and shifted either on to gas bills or general taxation. In a report last month, the quango said it was concerned that high electricity bills were preventing consumers from buying heat pumps and electric cars, which in turn was slowing down the energy transition. Business leaders have also urged Mr Miliband to scrap green levies as British companies grapple with the highest electricity prices of anywhere in the developed world. Rain Newton-Smith, the director general of the Confederation for British Industry (CBI), last week warned that the net zero costs were acting as an 'anchor' on UK ambitions. Household energy bills are set to fall next month after regulator Ofgem said it would lower the price cap by £129. Nevertheless, high energy costs remain a key political concern, especially as Britain ploughs ahead with a costly transition to renewable sources. In a sign of tensions over Labour's net zero strategy, Sir Keir Starmer has intervened in controversial proposals to make homes and businesses in the South pay more for power than those in the North. Supporters of so-called zonal pricing, which is under consideration by Mr Miliband, claim the switch would lead to savings of £52bn for consumers. Mr O'Shea said increasing energy storage would help to lower prices, but warned that other measures would amount to simply redistributing costs. He said: 'If we're just talking about reallocating things then the cost has to be met by the country. The question is who in the country meets that cost – is it consumers, is it businesses, is it the taxpayer?' The comments come a month after Centrica faced a shareholder backlash over Mr O'Shea's £4.3m pay package. The energy chief was handed a 29pc salary increase, though his total pay was down sharply on the year before, when it ballooned to £8m thanks to a bonus. Mr O'Shea has previously said it was 'impossible to justify' his pay when millions of households are struggling with their bills. Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more.
Telegraph
08-06-2025
- Business
- Telegraph
Raise taxes to bring down energy bills, British Gas boss tells Reeves
The boss of British Gas owner Centrica has urged Rachel Reeves to raise taxes to bring down energy bills. Chris O'Shea said the Chancellor must act to prevent hard-up households from shouldering the cost of Ed Miliband's net zero transition. In particular, he signalled that Centrica would support plans to shift green levies from household bills to general taxation. Speaking on BBC Radio 4's Broadcasting House, he said: 'The cost of the energy transition is not small. 'It's not because renewables are expensive, it's just because we have an energy system that was designed for a world that no longer exists, so we're having to upgrade the energy system and that requires a quite substantial investment. 'At the moment, the costs for doing that come off consumer bills. There is an option to put that on general taxation and that's something that we would support at Centrica.' Mr O'Shea acknowledged that the Chancellor was facing significant financial pressures, especially ahead of the upcoming spending review. However, he said: 'The reality is that we as a country have to pay for the upgrade of the energy infrastructure, either through bills or through general taxation.' His comments come amid mounting scrutiny over so-called green levies, which are charges added to household energy bills to help fund renewables such as wind and solar. These are seen as key to supporting Mr Miliband's target of reaching net zero by 2050. However, critics have accused the Energy Secretary of failing to tackle sky-high energy bills. The Climate Change Committee, which advises the Government on its emissions targets, has said that green levies should be removed from household costs and shifted either on to gas bills or general taxation. In a report last month, the quango said it was concerned that high electricity bills were preventing consumers from buying heat pumps and electric cars, which in turn was slowing down the energy transition. Business leaders have also urged Mr Miliband to scrap green levies as British companies grapple with the highest electricity prices of anywhere in the developed world.
