A Holyrood committee is to hold an inquiry into the security of Scotland’s energy supply in the wake of news that Longannet power station is likely to close prematurely.
MSPs on the Economy, Energy and Tourism Committee will take evidence on the UK electricity market with a focus on supply, demand and the transmission network.
It follows the announcement that the troubled coal-fired plant in Fife will “in all likelihood” shut by March 2016 after losing out on a short-term National Grid contract.
Operator Scottish Power said the station has been under pressure from higher transmission charges to connect to the grid due to its location.
Standard Chartered Plc’s Paul Horsnell forecasts oil will rise to $90 a barrel in the fourth quarter. Bank of America Merrill Lynch’s Francisco Blanch predicts $58. Six months ago, they were just $1 apart.
That sudden divergence highlights a growing trend: Energy analysts are the most divided in at least eight years on the direction of Brent crude, the global benchmark.
Forecasters failed to predict the plunge that cut oil prices by more than half after the U.S. shale boom boosted output to a three-decade high.
OPEC, led by Saudi Arabia, the world’s largest oil exporter, relinquished its traditional role adjusting production to moderate price swings in an effort to maintain market share.
The world’s longest electricity connector is to be built between the UK and Norway to supply low-carbon power from the Scandinavian country.
The 450-mile (724km) long “interconnector”, which has the capacity to supply enough electricity to power nearly three quarters of a million UK homes, will help with energy security and could cut consumer bills, officials said.
It will be the first electricity interconnector between the two countries, with the £1.5 billion cost of the scheme split between the UK and Norway.
The UK’s greenhouse gas emissions dropped by more than 8% last year in the face of lower electricity use and less burning of coal to generate power, provisional figures show.
Renewables such as wind, solar, bioenergy and hydropower generated almost a fifth (19%) of the UK’s electricity in 2014, a new record high for the clean technologies.
There was a drop in emissions of 8.4% in 2014 compared with 2013, while output of the main greenhouse gas - carbon dioxide - fell by nearly a tenth (9.7%), statistics from the Department of Energy and Climate Change showed.
Nearly half of Scotland’s energy consumption came from renewable sources last year, official figures show.
Provisional renewable electricity generation 2014 national statistics show 49.6% of gross electricity consumption came from renewable sources in Scotland last year, an increase from 44.4% in 2013.
Renewable electricity generation increased last year by 11.7% and is now estimated at 18,959 gigawatt-hours (GWh).
This is approximately enough electricity to power the equivalent of an additional 430,000 Scottish households for a year, compared to 2013.
The premature closure of Longannet power station at a time of falling spare capacity in the system is a “national scandal”, the energy minister has said.
Fergus Ewing told MSPs the Scottish Government would “strain every sinew” to help employees at the struggling Fife station if the closure cannot be averted.
Operator Scottish Power has said that it will “in all likelihood” shut by March 2016 after losing out on a short-term National Grid contract to Peterhead.
In a statement at Holyrood, Mr Ewing defended the Government’s renewables policy against claims it was harming power stations such as Longannet.
He said: “Some members opposite believe the development of renewables has harmed the prospects of thermo stations. Those arguments are false.
Private equity firm Quantum Energy Partners will invest up to $1billion in a strategic acquisition alliance with Linn Energy LLC.
A Letter of Intent (LOI) has been signed between the two companies which will see them find selected future oil and natural gas acquisitions and develop those acquired assets.
Linn Energy said it would participate with a working interest of 15-50%.
Scottish Power will likely close its coal-fired power station at Longannet in Fife next year.
The announcement comes after the energy firm lost out on a contract from National Grid.
A Peterhead gas-fired power station owned and operated by SSE was selected to provide voltage support services to National Grid between April 2016 and September 2017.
About 270 people are currently employed at Longannet.
More must be done to attract young people and women to work in Scotland’s energy industry, a new report concludes.
Attracting new entrants will be key to ensuring the future of the country’s oil, gas and renewable sectors, according to Skills Development Scotland (SDS).
It has published an updated skills plan for the industry, setting out priorities for developing the workforce against the backdrop of a fall in oil prices.
As the 2015 General Election approaches, the North Sea oil and gas industry has become a key focus for politicians.
The government recently outlined a raft of measures to support the sector, dropping the supplementary charge from 30% to 20% and decreasing the Petroleum Revenue Tax (PRT) by 15%.
Representatives from Liberal Democrat, Labour, Conservative and SNP will be taking part in a special panel session in Aberdeen centered around the energy industry and what politicians can do to support it.
Scotland’s new wave energy technology development body has opened a £7million innovation competition.
Wave Energy Scotland (WES) is offering funding of up to £4million for a single project to develop power take-off systems.
Businesses are invited to apply for funds to advance their power take-off system designs through testing and on to commercialisation.
Carlyle Group LP has raised $2.5 billion for an international energy fund as the private equity investor bolsters its oil and gas firepower after the collapse in prices.
Marcel van Poecke, head of Carlyle International Energy Partners, said the Washington-based firm closed the fund after commitments from 160 investors. The new fund, which will invest exclusively outside the US, will increase Carlyle’s war chest for energy deals to over $10 billion, the firm said.
“This is one of the best periods, if not the best, to invest in global energy,” van Poecke said in an interview.
Carlyle joins other private equity firms, including Blackstone Group LP, KKR & Co. and Apollo Global Management LLC, in raising extra funds for energy deals as oil and natural gas companies struggle to stay afloat.
A day after their biggest gain in six weeks, US stock indexes mostly fell yesterday as oil continued to slide and investors fretted over when the Federal Reserve will raise a key borrowing rate.
Low rates have helped stocks soar over the past six years. The Fed kicked off a two-day meeting yesterday to discuss rates, and will release a policy statement today.
Losses were small, but spread across industries. Nine of the 10 sectors of the Standard & Poor’s 500 index dropped, led by a 1.2% fall in raw-material companies.
Randall Warren, chief investment officer of Warren Financial Service, said he is not worried about higher rates, but is bracing for more price swings nonetheless.
A row broke out last night after a survey showed that the majority of people living in the north and north-east of Scotland support wind power.
The industry claimed the results shot down the “vocal minority” of objectors who claim that most Scots are opposed to giant turbines dotting the countryside.
But anti-windfarm campaigners said the findings had to be “taken with a bucket of salt” as they did not separate those who are “adversely affected”, mainly people living in rural areas and communities targeted by wind developers.
A report has been published on the performance of subsea cabling in high energy environments to support the development of commercial wave and tide energy sites.
The aim of the analysis, by the European Marine Energy Centre (EMEC) and The Crown Estate, is to improve the industry’s understanding of how best to specify and manage subsea cables.
Tests were done by investigation how the cables installed at EMEC test sites in Orkney have been performing since installation.
The amount of electricity produced by projects owned by local communities has increased by more than a quarter in the last year, the Scottish Government has revealed.
Ministers have set the target of having plants producing 500 megawatts (MW) of power in communities and local ownership by 2020.
The latest figures show such schemes can generate 361MW, up from 285MW in the previous year.
The increase was revealed by energy minister Fergus Ewing ahead of the Community and Renewable Energy Scheme (CARES) conference in Stirling.
Scotland’s oil and gas industry is going on a trade mission to Africa this week in answer to a call for support from a former president of Mozambique.
The east African nation and its neighbour Tanzania have some of the largest offshore gas fields in the world, but with no local supply chain and a lack of skilled workers, they are ill-equipped to recover the hydrocarbons.
Operators in East Africa, including Anadarko, ENI, BG, Shell and Petrobras, are prepared to step in and spend about £1.35billion on developing the fields, believed to contain 150trillion cubic feet of gas.
The Scottish Government will do everything in its power to prevent the premature closure of Longannet, the Deputy First Minister has pledged.
John Swinney was speaking in advance of a visit to the troubled Fife power station, which will close by the end of March next year unless it secures a short-term National Grid contract.
A decision on the contract, which is to help maintain voltage levels in the electricity supply from April 2016 to October 2017, is expected by the end of the month.
The Scottish Power-operated coal-fired station is under pressure from new European Union environmental legislation and carbon taxation combined with higher transmission charges to connect to the grid due to its location in Scotland.
Oil and Gas services firm Weir rose by nearly 5% amid speculation it could be the subject of a break-up bid from a US private equity firm.
The stock, which has hit turbulence in recent months due to the fall in oil prices, was 85.5p higher at 1824.5p.
Other big risers included Taylor Wimpey after the company this week joined rival firms in reporting a strong start to the important spring selling season.
The President of Mexico said his country was keen to learn from the expertise of the North Sea oil and gas industry on a trip to Aberdeen yesterday.
A heavy police presence, a civic reception and some of the country’s top politicians greeted Enrique Pena Nieto in what was his only commitment outwith London during his stay in the UK. In the grand surroundings of the Town and County Room in the town house, President Nieto signed memorandums of understanding with the UK Government to forge closer links on energy and climate change.
Lord Provost George Adam and Secretary of State for Scotland Alistair Carmichael welcomed the Mexican delegation to the north-east, while UK energy minister Matt Hancock described it as the dawn of “an era of closer collaboration”.
President Nieto said his country had “enormous” reserves of oil and gas, but was “not capable of exploiting them”.
Pemex Exploracion y Produccion can’t recover hundreds of millions of dollars lost on Mexican condensate smuggled across the Texas border by bandits and sold to Shell Chemical LP, ConocoPhillips Co., BASF Corp. and other buyers that didn’t know the feedstock was stolen, a federal appeals court ruled.
A Houston federal judge threw out the claims last year after finding Mexico’s national oil company waited too long to pursue US buyers of its stolen natural gas liquids, after it failed to halt the thefts on its side of the border.
What a difference a year makes.
Twelve months ago the shale revolution in the US was changing everything, from manufacturing competitiveness to traditional import/export flows and even longstanding geopolitical arrangements this side of the pond, shale exploration was pretty much on each EU country’s agenda, with shale gas often seen as the only way out of Russian dependency.
Now we are in the middle of another quantum shift which is transforming everything again.
Crude prices have plunged, Russia is in recession, experts are declaring shale investments dead in the water (too soon in my view) and government policies favouring renewables are under new scrutiny, as economics suddenly favour dirtier coal and gas.
Whether you blame technology, politics, softening demand or a mix of all three, these ructions are testament to the dynamic nature of energy markets and the huge risks that emerge in a period of profound volatility.
The President of Mexico will visit Aberdeen today to sign a memoranda of understanding on collaboration in the energy sector.
Enrique Pena Nieto will be joined by Scottish secretary Alistair Carmichael, UK energy minister Matthew Hancock and Scotland’s external affairs secretary Fiona Hyslop on the final day of his state visit to Britain.
The UK public believes that wind power subsidies paid by consumers are many times higher than they actually are, according to polling for the industry.
A survey questioned 2,000 people for industry body RenewableUK about what they thought payments for wind farms added to fuel bills, and found the average estimate was £259 for a typical £1,300 dual-fuel energy bill.
But the industry said the actual cost of wind power subsidies from domestic energy bills was around £18 a year.
Oil prices could drop again later this year as a supply glut persists, according to Jason Kenney, a Banco Santander SA analyst who accurately predicted a rebound in prices after the 2008 slump.
The current oil shock caused by the boom in U.S. shale production is reminiscent of the mid-1980s, when development of fields in the North Sea and the Gulf of Mexico caused a supply glut, Kenney, the head of European oil and gas equity research at the Spanish bank, said by phone from Edinburgh Thursday.
It differs from the 2008 collapse, which was caused by slumping demand in a recession, Kenney said.
