UN climate chiefs have backed hydraulic fracturing, or fracking, as part of the solution to global warming, according to a report carried by the Telegraph newspaper on Sunday. Fracking is the controversial process of extracting natural gas from shale rock layers deep within the earth.
Ottmar Edenhofer, co-chair of the working group that drew up the report, said it was “quite clear” that shale gas “can be very consistent with low carbon development and decarbonization.”
The comments give support to British Prime Minister David Cameron’s earlier call for energy independence and the adoption of technologies like shale gas fracking to top Europe’s political agenda. Cameron said on March 25 that the Crimea crisis was a “wake-up call” for states reliant on Russian gas. Britain has a “duty” to embrace fracking, he added.
Europe fears that Russia might cut off the gas supply that they rely on as retaliation to Western sanctions.
Although the UK imports less than 1 percent of its gas directly from Russia, Russia’s energy giant Gazprom claims it sells between 11 billion and 12 billion cubic metres to the UK, which is about 15 percent of the country’s total need. Supplies of Russian gas indirectly reach Britain through other European countries. This explains why in 2009 UK gas prices soared by 17 percent when Russia cut off the gas to Ukraine.
The “shale gas revolution” in the US seems to inspire Britain’s hope that it can also be a game-changer for the UK in terms of energy, economics and geopolitics.
The United Nations has to called on world leaders to triple the planet’s use of renewable energy in a new report on climate change this month. Titled “Mitigation of Climate Change” by the UN’s Intergovernmental Panel on Climate Change (IPCC), the report – revealed on Sunday – highlights the increased carbon emissions produced in the last few decades as being a catalyst for climate change. The panel presenting the report does say that this can be reversed, but only if a “massive shift” in the commercial energy marketplace is made within the next decade.
Glasgow-based gas meter firm Smart Metering Systems SMS has expanded into the electricity sector by buying Utility Partnership Ltd UPL for £14m.SMS will pay £9.7m in cash, with the rest being met by the issue of shares.
UPL manages electricity meters across the UK and offers connections, design, meter installation, data management and energy management services.Last year Cardiff-based UPL reported annual turnover of £11.1m, with profits before interest and tax of £2m.It has managed and installed more than 80,000 meters for the UK’s electricity suppliers.SMS chief executive Alan Foy said: “The acquisition of UPL will enable SMS to expand its service offering across the gas and electricity sectors, and the enlarged group will now offer a fully integrated service in these markets.”It positions the enlarged company as a dual gas and electricity service provider and establishes a base from which we can enhance our existing respective client relationships.”
We’re spending more and more on energy with no end in sight, regardless of what shade of green we plan for our future. Can we do anything about it? Gas prices are not easy to control, but politicians do set energy taxes and levies, and decide on how investment in low-carbon power generation, the power grid and energy efficiency is spent.
Understanding what makes up our energy bills is key to holding politicians and energy providers to account. Here are the five reasons your gas bills are high and rising.
1. High gas prices
“In the last 10 years, commodity prices are probably the single biggest thing that has affected energy bills in the UK,” says energy consultant Matt Brown. Most of the money households fork out for energy is spent on gas for heating, some 60%. But in the UK’s gas-driven power sector, the gas price has also become the main driver of the electricity price.
Energy bills have gone up as the UK shifted from being a net exporter to a net importer of gas in the last decade, and gas prices rose in tandem with oil prices. The two fuels are typically drilled for together and their prices remain closely linked, despite Brussels’ efforts to create more of an open market for gas.
Eurostat, the statistical office of the European Union have released their long-awaited publication on renewable energy consumption in the twenty-eight EU member states for 2012.
Revealed at the end of last month, this new report takes the full calendar year of 2012 into account, producing a fascinating insight into the commercial energy market for Europe, with chance to see not only how other countries on the continent are managing and consuming renewable energy.
The headline news from the report showed that consumption of renewable energy was up in 2012, hitting a record high of 14% of all energy consumption in the EU28.
Over the last eight years, that represents a 5.8% increase from the total in 8.3% in 2004 – the first year from which the data was recorded by Eurostat.
Despite leaning heavy pressure on a number of member states to meet a renewable energy benchmark by 2020, the European Union will see this promising progress as justification for the initiative which has cause no small amount of tension in some nations thanks to the economic crisis.
Ofgem has fined the arm of British Gas which serves business customers for a series of failures including blocking firms from switching to other suppliers.
The energy regulator said British Gas Business would pay a total penalty of £5.6m.
It said £800,000 of that sum would be in fines, on top of £1.3m already paid to 1,200 customers who ended up paying higher bills because they were not notified when their contracts were due to expire.
A further £3.45m would go to an energy efficiency fund, Ofgem said.
It blamed a computer error for the blocking of customers wanting to switch and said the company failed to communicate properly with those affected.
A unit of British Gas is to pay £5.6m in fines and compensation after Ofgem found the company incorrectly blocked businesses from switching suppliers.British Gas Business also failed to give some businesses notice that their contract was due to end.It has paid almost £1.3m to affected businesses and will pay a further £3.45m into an energy efficiency fund. It will also pay a £800,000 penalty.
British Gas Business said it was “sorry” the errors had occurred.After investigations by Ofgem, British Gas Business was found to be incorrectly blocking business customers from switching to other suppliers in addition to failing to notify customers when their contracts were close to expiring.Ofgem found that, between 2007 and 2012, 5.6% of objections made by British Gas Business to business customers who wished to switch suppliers were invalid.Furthermore, specific reasons as to why businesses were being prevented from switching were not communicated and there were no details for customers on how the issues could be resolved.
Ovo Energy, a small power company, has pledged to bring annual bills down to under £1,000.
Ovo says that a 9.5% fall in wholesale gas prices over the winter has allowed it to lower prices.
Its pledge comes just weeks after a competition inquiry was announced into the “big six” energy firms to see if they are hampering competition in the energy market.
Ovo’s price is based on a dual fuel, medium user paying by direct debit.
In the UK, the average annual dual-fuel bill – covering gas and electricity – is about £1,264 per household.
Last month, SSE – one of the big six energy firms – said it would freeze domestic gas and electricity prices at their current levels until 2016.
The price of energy has become an important political issue, particularly after several of the big energy firms raised tariffs at the end of last year.
Last month, a report by regulator Ofgem called for an investigation into the market by the Competition and Markets Authority (CMA).
The Ofgem report criticised the effectiveness of competition.
Large windfarms can knock as much as 12% off the values of homes within a 2km radius, and reduce property prices as far as 14km away, according to research by the London School of Economics. The findings contrast sharply with a report by the Centre for Economics and Business Research in March, which found no negative impact on property prices within a 5km radius of a turbine.
The LSE findings will fan demands by homeowners for compensation when windfarm developments are given the go-ahead. Currently, windfarm operators pay rent on the land they occupy and make contributions to community causes, but are under no legal obligation to compensate homeowners for loss of value.
The report, “Gone with the wind: valuing the visual impacts of wind turbines through house prices”, by Professor Stephen Gibbons, found that “windfarm developments reduce prices in locations where the turbines are visible, relative to where they are not visible, and that the effects are causal”.
For the average sized windfarm, the price reduction is around 5-6% for homes with a visible windfarm within 2km, falling to less than 2% between 2-4km, and to near zero between 8-14km, which is at the limit of likely visibility. In areas close to windfarms, but where the turbines are not visible, the report found there was a small increase (around 2%) in property prices.
Ofgem has proposed to refer the energy market for an investigation by the Competition and Markets Authority (CMA), following an assessment of its present state that revealed a number of concerns.
The regulator, alongside the CMA and the Office of Fair Trading, issued on 27 March its State of the Market assessment.
The report found that average profits for the Big Six increased from £3bn in 2009 to £3.7bn in 2012. Given there was no clear evidence of increased efficiency from suppliers, Ofgem claimed the increases could be indicative of a lack of effective competition.
The report also noted that there was continuing uncertainty over whether the vertical integration of the large energy companies was in consumers’ interests. It further highlighted weak competition between larger energy suppliers, low customer trust and engagement, and barriers to entry and expansion for new suppliers.