UK utilities warn climate change to threaten power investment - MarketWatch


LONDON (MarketWatch) -- U.K. utilities and the government Monday warned that climate change threatened to undermine the power sector's investment in power plants and transmission lines unless appropriate forecasts were devised to help guide the power sector's future investment policy.
Most of the U.K.'s power plants and power lines were constructed to operate in cold winters and mild summers, senior utility executives said at a press conference in London. But climate change threatens to make winters more mild and summers much hotter, leading to both a change in power consumption and greater strain on power transmission and generation assets, the utility executives added.
During the conference, utility executives from E.On U.K., the U.K. arm of German utility E.On AG (EON), EDF Energy, the U.K. arm of Electricite de France (1024251.FR), U.K. power grid operator National Grid PLC (NGG) announced the conclusions of a document which outlined the impact that climate change could have on the U.K.'s power sector infrastructure. The document was put together by the three companies in participation with the U.K.'s weather agency, the Met Office.
Speaking at a press conference, Mark Hutchinson, chief executive of the Met Office, said the U.K.'s nuclear power plants could be in danger if climate change leads to more severe storms and increased coastal flooding. He pointed out that many of the U.K.'s nuclear power stations are on the coast, where they remain vulnerable to shore erosion.
Hotter summers are also likely to place greater strain on the U.K.'s power transmission system as people flick on their air conditioning to cool off, EDF Energy's CEO Vincent de Rivaz told reporters. Companies will need to invest in power transistors that can operate under hotter temperatures to ensure that demand can be met, he said.
Secretary of State for Trade and Industry Alistair Darling said at another conference Monday that global average temperatures are expected to rise by 1.4-5.8 degrees Celsius and sea levels could rise by up to three feet during this century as a result of climate change.
Paul Golby, chief executive of E.On U.K., also said hot summers threatened to lower the efficiency of the U.K.'s aging transmission infrastructure and gas-fired power plants. Higher temperatures lower the efficiency of gas-fired power stations by 5% or more, a power company executive explained.
The U.K. already loses about 5%-6% of its electricity as it travels from power stations to customers. The amount is likely to increase as higher temperatures sap moisture from the soil and causes power lines to sag, utility executives at the conference explained.
The executives said moisture provides a natural insulator for underground power cables by keeping the cables cool. They also said heat causes overhead cables to expand and therefore sag, posing a danger to local communities. As a result utilities have to lower the amount of electricity that travels through the cable to avoid breaching safety standards.
Company Web sites:
http://www.eon-uk.com
http://www.edfenergy.com
http://www.nationalgrid.com
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