Nationalise gas power plants to boost energy security, thinktank urges UK ministers
Britain’s gas power stations should be nationalised to prevent their owners from holding the electricity market “to ransom”, a thinktank has urged.The country’s dwindling fossil fuel power plants are ripe for nationalisation as ministers aim to reduce gas consumption to just 5% of the electricity system by 2030, according to a report by Common Wealth.Taking the plants back under public control could also prevent the owners from commanding fees of up to 100 times the normal market rate to run when renewable energy generation is in short supply, the thinktank added.“Privately owned gas-fired power plants exploit a unique market power position in the ‘balancing mechanism’, holding the grid to ransom and demanding eye-watering sums of money to supply energy at short notice,” it said.“British households are effectively transferring their wealth to billionaire-owned private equity funds and even foreign governments,” it added, referencing a string of multimillion-pound payments made to a handful of power plants earlier this year.
The Guardian revealed in January that almost £18m was paid to two power plants to run for a few hours during a cold snap that coincided with low windpower output.The Connah’s Quay gas plant in north Wales, operated by German state-owned Uniper, raked in £10.3m from the grid operator while the Rye House gas-fired power station, just north of London, which is owned by private-equity backed commodities trader Vitol, received almost £7.5m.The companies said at the time that they invested significantly in the plants throughout the year to ensure they are available on the rare days when needed to safeguard Britain’s power system.
Paul Morozzo, a senior campaigner at Greenpeace UK, said: “Given the government is aiming for an almost exclusively clean power system by 2030 – with only a strategic reserve of gas – taking them into public ownership is one way to avoid these companies charging excessive rents.“The sooner the government puts a stop to this unfair profiteering, the sooner it can lower bills.”Sign up to Business TodayGet set for the working day – we'll point you to all the business news and analysis you need every morningafter newsletter promotionCommon Wealth, which designs public ownership models, has called on the government to create a strategic reserve of gas power stations to run only as a last resort during periods of high electricity demand.The plants could then be wound down as the UK shifts its electricity system away from fossil fuels to clean power by the end of the decade.A government spokesperson said: “Our mission for clean power by 2030 will replace our dependency on unstable fossil fuel markets with clean, homegrown power controlled in Britain – which is the best way to protect bill payers and boost our energy independence.
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Spain and Portugal power outage: what caused it, and was there a cyber-attack?
Spain, Portugal and some of south-west France suffered a massive power cut on Monday, with major cities including Madrid, Barcelona and Lisbon among those affected.Houses, offices, trains, traffic lights and even the Madrid Open tennis tournament were all hit, causing chaos for millions of people and prompting a scramble by the Spanish and Portuguese governments and network operators to understand the problem and race to fix it.Red Eléctrica de España (REE), Spain’s electric network, said Spain and Portugal were hit by “el cero” – the zero. Its Portuguese counterpart, Redes Energéticas Nacionais (REN), said the outage started at 11.33am western European summer time
HSBC sets aside more cash for bad loans amid Trump tariff war
HSBC has sounded the alarm about the impact of higher trade tariffs on economic growth, unemployment and inflation around the world, as it set aside more money to cover bad debts and reported lower profits.The UK-based bank reported a $200m (£149m) rise in expected credit losses to $900m in the first quarter, as it increased allowances to “reflect heightened uncertainty and deterioration in the forward economic outlook due to geopolitical tensions and higher trade tariffs”.HSBC said: “A further escalation of tariffs and trade tensions could lead to lower trade volumes, investment, consumer spending and, ultimately, weaker global GDP growth.“Supply chains could also come under renewed pressure from a fragmented trade landscape, which could cause inflation to rise again.”However, Georges Elhedery, the chief executive, said: “Ourselves and our customers as a whole are hopeful that we can see progress in the trade negotiations between the US and a number of parties, including China
Primark owner’s shares drop as sales fall amid Trump tariff fears
Shares in the owner of Primark fell after the budget clothing chain posted a sharp drop in UK sales and lost market share, as the company warned that consumer confidence was likely to worsen further amid Donald Trump’s trade wars.Associated British Foods (ABF), which also owns a sugar business and food brands such as Ryvita and Kingsmill, said several countries could slide into recession as a result of US trade policy.“Sentiment is unlikely to improve as markets continue to face uncertainty and instability following recent tariff announcements by the US, retaliatory actions by China and the risk of further tariff trade wars,” ABF said. “Consumer confidence could deteriorate further as a number of countries, including the US, face the risk of recession that could increase individuals’ debt problems.”The company made the warning as Primark posted a 6% decline in comparable sales in the UK and Ireland in the 24 weeks to 1 March, despite strong sales growth over the Christmas period
Adidas warns Trump tariffs will put up US shoe prices
Adidas has said the price of its popular trainers, including the Samba and Campus models, is likely to rise as a result of Donald Trump’s tariffs.The German group said the uncertainty around US import tariffs had prevented it from raising its outlook for sales and profit this year despite reporting strong first-quarter results.“Since we currently cannot produce almost any of our products in the US, these higher tariffs will eventually cause higher costs for all our products for the US market,” said Adidas’s chief executive, Bjørn Gulden. “Given the uncertainty around the negotiations between the US and the different exporting countries, we do not know what the final tariffs will be.”Fashion brands, and especially sports shoe producers such as Adidas, will be hit by the introduction of tariffs as the bulk of their products are made in countries including Vietnam, Indonesia and China
Macquarie ‘very proud’ of Thames Water ownership despite loading it with debt
The investment bank that sold Thames Water in 2017 after loading the company with debt has said that it is “very proud” of its record, even as the water utility teeters on the verge of collapse.Australia-headquartered Macquarie led a consortium that owned Thames Water from 2006 until 2017. Macquarie has been criticised by some politicians and analysts for its control of the business, accusing the bank of setting it on course for financial collapse.Thames Water supplies water and sewerage services to 16 million customers in London and south-east England. However, it has reached the edge of collapse after debts rose to near £20bn, and it last month won court approval for £3bn in emergency funding
Drugmaker AstraZeneca shifts more production to US amid Trump tariffs
AstraZeneca said it was shifting the production of some medicines sold in the US from Europe to the US, to counter the impact of Donald Trump’s trade tariffs.Speaking as the company reported higher sales and profits for the first quarter, the FTSE 100 pharma company reiterated that the UK, and the rest of Europe, risked losing out to the US and China unless they ramped up spending on new medicines. Pascal Soriot, AstraZeneca’s chief executive, warned that well-paid advanced manufacturing and research jobs could move to the US in the long run.While the industry is holding its breath in case of threatened US tariffs on the pharma sector, which has been largely exempt from duties under a 1995 World Trade Organization agreement aimed at keeping medicines affordable, Soriot said the impact on AstraZeneca would be limited.If tariffs were imposed in the range announced against imports from other industries from Europe to the US, the drugmaker would still be able to achieve its targets this year, as it has built up inventories in the US, he said
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