British Energy is one of the few government bail outs will end up being a good deal for the taxpayer. There is no doubt that it is luck because the government probably under-estimated the risks they were taking.
In 2002 the tax payer inadvertently subsidised energy. British Energy went bust and in order to make re-payment on a number of loans the government bailed them out. This was prudent because no doubt if they had not, the lights would have gone out. The loan was for just under £800m and the payment for the loan was a share of the business. At the time power prices were around £20/MWh for an annual contract today they are at £55, and so the value of this loan is significant, in fact BE is worth today about £3bn and the government has instructed three banks to look at selling 65% of the company netting the UK tax payer £2.6bn. Not bad on a £800m loan over four years.
The wonder is that if this had gone wrong in some way and that power prices had stayed low and that BE continued to be run badly would the government still be looking quite so rosy?
19 October 2005
Nuclear to be or not to be that is the question? read more...
29 June 2005
"Ever wondered why fund managers can't beat the S&P 500? Cause they're sheep, and sheep get slaughtered." Wall Street read more...
14 April 2005
British Energy change their board but not the fundamental reason as to why they need to change. read more...
13 April 2005
IAS 39 appears to be a minefield for accountants to make money. read more...
Winter 11 - A Slippery Slope
While March was a month of shocks and gains, April seems to have marked the start of a downward trend in the UK power market. The WInter 11 contract is just one example. read more...
06 May 2011
While March was a month of shocks and gains, April seems to have marked the start of a downward trend in the UK power market. The WInter 11 contract is just one example. read more...
Japan, Germany & MENA -Global Energy
Bullish gains were seen across the fuels complex as traders and analysts rushed to assess the impact of the devastating earthquake and subsequent Tsunami in Japan as well as Germany's announcement that it was to take 7 nuclear generators offline immediately. read more...
18 March 2011
Bullish gains were seen across the fuels complex as traders and analysts rushed to assess the impact of the devastating earthquake and subsequent Tsunami in Japan as well as Germany's announcement that it was to take 7 nuclear generators offline immediately. read more...
EdF to pay £12.5 billion for British Energy
EDF has struck a £12.5billion deal to take over British Energy, the British nuclear generator. read more...
24 September 2008
EDF has struck a £12.5billion deal to take over British Energy, the British nuclear generator. read more...
Centrica and BE - A Natural Fit?
Invesco – the investment company that owns 15% of British Energy and 5% of Centrica has discussed with the Government the possibility of a merger between the two energy companies. read more...
27 August 2008
Invesco – the investment company that owns 15% of British Energy and 5% of Centrica has discussed with the Government the possibility of a merger between the two energy companies. read more...
British Energy forecast to be back in Dec
Market expects to see nukes return in Decemeber. read more...
11 August 2008
Market expects to see nukes return in Decemeber. read more...
Solar in the UK - Not So Bright
DECC has published the Comprehensive Feed-in Tariff (FiT) document and at the same time, many say, put a nail in the coffin for the Solar Industry in the UK. With the FiT rate for Solar Power to be cut by more than 50%, and with a proposal that eligibility to the scheme should be linked to a minimum energy efficiency requirement - many fear that this will be the end for the industry read more...
01 November 2011
DECC has published the Comprehensive Feed-in Tariff (FiT) document and at the same time, many say, put a nail in the coffin for the Solar Industry in the UK. With the FiT rate for Solar Power to be cut by more than 50%, and with a proposal that eligibility to the scheme should be linked to a minimum energy efficiency requirement - many fear that this will be the end for the industry read more...
Carbon Floor Price Announcement: The Market Reacts
The tensions seen in the markets last week, as participants assessed the impact of Japan and nuclear withdrawal in Germany, appeared to have eased when the market started trading on Monday. The Government's mid week budget Carbon Floor Price announcement soon changes that though read more...
25 March 2011
The tensions seen in the markets last week, as participants assessed the impact of Japan and nuclear withdrawal in Germany, appeared to have eased when the market started trading on Monday. The Government's mid week budget Carbon Floor Price announcement soon changes that though read more...
We're borrowing less than expected....
As the government prepares its spending review it will no doubt welcome the latest figures that show net borrowing for July at £3.8bn. While still sizeable, this is £1.2bn less than forecast and well down on the £6.1bn that was borrowed in the same month last year. read more...
20 August 2010
As the government prepares its spending review it will no doubt welcome the latest figures that show net borrowing for July at £3.8bn. While still sizeable, this is £1.2bn less than forecast and well down on the £6.1bn that was borrowed in the same month last year. read more...
Confidence knocked in the Financial Markets
Statements from around the world all suggest a stalled recovery while closer to home there are continuing signs of inflationary pressures at a time of slow to stagnant growth. read more...
12 August 2010
Statements from around the world all suggest a stalled recovery while closer to home there are continuing signs of inflationary pressures at a time of slow to stagnant growth. read more...
Energy Secretary gives the first annual energy statement to the Commons
Chris Huhne, the coalition government Energy Secretary yesterday gave the first annual energy statement to the Commons. He set out plans to secure energy supplies and cut carbon emissions. In all 32 measures were outlined all with the aim of helping the UK achieve the legally binding target to cut emission by 80% by 2050. read more...
28 July 2010
Chris Huhne, the coalition government Energy Secretary yesterday gave the first annual energy statement to the Commons. He set out plans to secure energy supplies and cut carbon emissions. In all 32 measures were outlined all with the aim of helping the UK achieve the legally binding target to cut emission by 80% by 2050. read more...
November 2011 Review
While debt repayment concerns combined with woeful economic indicators continued to be a feature throughout November, supply and demand fundamentals were an obvious driver too. Unseasonably warm weather combined with (and causing) plentiful gas storage meant that UK power and gas markets went into a nose dive. read more...
02 December 2011
While debt repayment concerns combined with woeful economic indicators continued to be a feature throughout November, supply and demand fundamentals were an obvious driver too. Unseasonably warm weather combined with (and causing) plentiful gas storage meant that UK power and gas markets went into a nose dive. read more...
Prepare for the clash of OPEC & IEA
With less than a month to go until OPEC meets, the statements are beginning to fly: OPEC believe the oil market looks balanced while the IEA again are saying that high oil prices could harm fragile global economic growth. Let the battle begin! read more...
23 November 2011
With less than a month to go until OPEC meets, the statements are beginning to fly: OPEC believe the oil market looks balanced while the IEA again are saying that high oil prices could harm fragile global economic growth. Let the battle begin! read more...
Markets Still Jittery
Most markets reported further losses today on the back of underlying nerves about the ability of both Europe and the US to repay their debts. Oil, commodities and equities all reported losses. read more...
21 November 2011
Most markets reported further losses today on the back of underlying nerves about the ability of both Europe and the US to repay their debts. Oil, commodities and equities all reported losses. read more...
Turmoil returns on Greek Announcement
Following last weeks announcement that the eurozone leaders had reached an agreement on a Greek bailout - one that would see banks take a 50% hit on their holdings of Greek debt, the Greek Prime Minister made his own shocking announcement that he plans to hold a referendum on the matter. The Markets tumble in response. read more...
01 November 2011
Following last weeks announcement that the eurozone leaders had reached an agreement on a Greek bailout - one that would see banks take a 50% hit on their holdings of Greek debt, the Greek Prime Minister made his own shocking announcement that he plans to hold a referendum on the matter. The Markets tumble in response. read more...
Eurozone Debt Deal Announced
After prolonged discussions and late night talks, European leaders have announced a agreement on a a Eurozone debt deal. But will the devil be in the detail? read more...
27 October 2011
After prolonged discussions and late night talks, European leaders have announced a agreement on a a Eurozone debt deal. But will the devil be in the detail? read more...
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