Utilities Switch Off Investment in Fossil Fuel Plants - NYTimes.com - 0 views
www.nytimes.com/...ent-in-fossil-fuel-plants.html
utilities switch investment fossil fossil fuel fuel plants
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Gene Ellis on 10 Jan 14Note: a LARGE power station =s 40 direct jobs.
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workers at the large power station known as Keadby 1 are preparing to shut it down at the end of the summer, with the loss of about 40 jobs.
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It has also delayed new energy investments and is planning to close almost a quarter of its fossil fuel power plants,
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European energy companies, struggling to respond to weak demand in a flatlining economy, say they need guaranteed pricing to keep open unprofitable plants or to invest in new ones.
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Their revenue is being hit by dwindling demand for electricity and by new wind and solar projects that undercut the price of the energy produced from many fossil fuel plants.
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At the same time, record-low prices on carbon emissions trading markets, which were introduced to encourage clean and efficient energy production and use, have perversely become a disincentive to investment.
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Many of the Continent’s aging power stations, particularly those that burn highly polluting coal, are earmarked for closure by 2020 to meet stringent local environment regulations.
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Without these investments, industrial companies in Europe may face higher energy prices when local economies eventually recover,
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In a bid to generate 20 percent of the European Union’s electricity from renewable sources by 2020, Germany, Spain and other E.U. countries have provided hefty subsidies to wind and solar farms, which now constitute a sizable minority of daily electricity generation, often surpassing the 20 percent target.
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In effect, a cheaper overall form of energy (non-renewables) had to compete with heavy subsidies to renewables, which, once built, had low operating costs. They cannot compete and do not invest, and there are major problems w/investing more in renewables (they are overall more expensive, and they have built-in faults, producing electricity erratically, or during the wrong times.) The high costs of energy also lie with government, who cemented long-term deals with the ex-USSR linking other energy prices to the price of oil. In short, they shot themselves in the foot. Several times.
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Despite the upfront costs associated with green energy projects, they are inexpensive to run. In contrast, Europe’s gas and coal plants, which also provide backup power when renewables cannot operate, need constant spending on fossil fuels.
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European utilities like E.On of Germany have announced plans to shut down less-polluting natural gas-fired plants that have been undercut by dirtier coal-burning generators benefiting from a flood of low-cost coal imports and low carbon emissions prices.
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Some analysts also expect domestic regulators to eventually create financial incentives for companies