Locations
Welcome to this edition of Fieldfisher's Energy Update. We have had another busy couple of weeks in the sector with planning consent for nuclear and moves towards and away from renewables/green technology and we look forward to the report from the British Geological Survey regarding UK shale in the near future. We hope you will find this of interest.
Regards
Dodd-Frank Reporting and Record keeping Regulations to come into force on 10 April
April 10 is the date that certain regulations made by the US Commodities Futures Trading Commission under the US Dodd-Frank Act come into effect. The new regulations aim to reduce risk within over-the-counter derivatives market. Although the Dodd-Frank Act is focussed at the financial industry, the regulations are likely to affect energy companies. The regulations will have significant effects for energy trading firms, as swap reporting and record keeping requirements become mandatory.
For further information on the regulations, please click here.
Planning granted for the New Hinkley Point nuclear power station
The Government has granted energy supplier, EdF, development consent for the first new nuclear power station in the UK since Sizewell B was constructed in 1995. The consent authorises the construction of a 3260 MW nuclear power station at Hinkley Point in Somerset providing sufficient electricity to meet the needs of up to five million homes. The application gave rise to many concerns and objections, but Edward Davey, the Secretary of State for Energy and Climate Change has concluded that the impacts of the construction and operation of the power station are outweighed by the potential for local benefits and the vital contribution to the UK's energy security needs and to tackle climate change. There is a six week period beginning on 19 March 2013 during which the Secretary of State's decision can be challenged in court. In the meantime, negotiations are continuing between the Government and EdF on the level of subsidy the company will be entitled to during the lifetime of the plant. EdF has made clear that reaching a satisfactory conclusion to these negotiations will be critical to their willingness to commit to the capital costs (estimated at £14 billion) of the project.
For further information on the development consent, please click here.
UN plans help accelerate green tech growth
A recent study has found that programmes which fast-track green patents are accelerating the growth of clean technology. In line with UN plans to accelerate the diffusion of green technologies, several countries have now launched fast-track patent schemes. The study has been carried out by the International Centre for Trade and Sustainable Development in Geneva and comprises an in-depth analysis on the effects of the faster paced patent applications.
Please click here for Fieldfisher's review of the study and future developments in this area.
Trump trumped by Scottish wind farms decision
The Scottish Government has given consent for the construction of an eleven turbine, offshore wind farm located between 2 and 4.5 km off the Aberdeenshire Coast. The project will be capable of generating up to 100 MW of electricity.
The Scottish Government has stated that this will not be a conventional wind farm, but an "offshore deployment centre" where offshore wind companies can test new technologies in an offshore environment before rolling them out on a commercial basis. Further consents in relation to marine matters, and onshore elements of the project will still need to be obtained.
Donald Trump, whose golf resort north of Aberdeen would be in the vicinity of the wind farm has objected strongly to the proposal, and has stated that he will use "every legal means" to defeat the proposal in the courts
For further information on this matter, please click here and for a media reaction here.
Progress at Islandmagee for Infrastrata
Infrastrata continues to progress its planned Islandmagee gas storage project which it is hoped will supply up to 5% of UK and Ireland demand on a peak day. On 23 March the Planning and Hazardous Substances Applications for the project were submitted in Northern Ireland. The proposed facility will store 500 million cubic metres of natural gas at a depth of 1,500 metres, at a site located close to existing gas infrastructure at Ballylumford on Islandmagee, County Antrim. Infratrata plan to hold public information events to keep the local public up to date.
Please click here for further details of the project and here for information regarding the public consultations.
European Commission consults on proposals to simplify EU Merger Regulations
On 27 March 2013, the European Commission published for consultation proposals to simplify the procedures for notification of mergers under the EU Merger Regulation. The consultation proposals include:
- expanding the scope of the simplified procedure;
- amending the Regulation implementing the Merger Regulation in order to update and streamline the merger notification forms;
- a revised Form CO;
- a revised Short Form CO; and
- a revised Form RS.
The proposals are a technical reform within the existing framework of EU merger control as defined by the Merger Regulation. It does not entail an amendment of the Merger Regulation itself. The intention of the proposals is to simplify the procedure in order to reduce the burden for merging companies. Consultation closes on 19 June 2013.
Please click here for the consultation documents.
Update on the electricity and gas network codes
On 27 March 2013, the Agency for the Co-operation of Energy Regulators (ACER) published its recommendations to the European Commission for the adoption of the Network Codes on demand connection, on gas balancing and for requirements for grid connection applicable to all generators. ACER identified a number of areas for improvement and further clarity in the Network Codes relating to on demand connection and to grid connection, but considered that these can be addressed by the Commission when adopting the Network Codes. The Network Codes are required by the EU Third Energy Package. The Network Codes are mainly to deal with cross-border and market integration issues. However, they will inevitably require changes to some market players' current arrangements. A Code becomes binding once adopted by the Commission.
Further details of ACER's recommendations can be found here.
BP retreating from renewables
BP has put is US wind power unit up for sale, valued at US$1.5bn. BP is currently one of the larger wind generators in the US generating 2,600MW across nine states. Having previously withdrawn from the solar industry and dropped its investment in carbon capture and storage technology, this move marks a further retreat from renewable energy as BP focuses on its core oil and gas business. This is in some contrast to Shell's recent R&D announcements.
For more information about this please click here.
Shell to advance spend on renewables
Shell currently spends US$1.3bn a year on research and development. Shell is aiming to expand this over the next 6-8 years, and will look to spend approximately 30% on the growth of renewable energy forms and 70% on building on the extraction of traditional hydrocarbons. Shell aims to do this by establishing a new fund that will take small stakes in companies aiming to commercialise innovations including, energy storage systems and hydrogen fuel.
For more information, please click here and here.
Jurassic Coast Study Centre - new website up and running
For those wanting to find out more about this worthwhile project designed to encourage youngsters to get involved in Earth Sciences, please click here or contact Tim Bird.