Oregon Regulators Approve Rate Hikes for Some Smaller Electricity Users

By Associated Press


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The Oregon Public Utility Commission approved, reluctantly, a rate hike for some residential and small-farm electricity customers of private utilities in Oregon.

The rate hike affects about 75 percent of electricity customers in Oregon.

Portland General Electric and PacifiCorp customers saw a 13 percent hike in their bills on June 1. Affected customers of Idaho Power saw their rates increase by 6 percent at the same time. The change does not affect industrial customers.

PacifiCorp is owned by MidAmerican Energy Holdings Co., which is controlled by billionaire Warren Buffett. Berkshire Hathaway is his investment group. IdaCorp Inc. operates Idaho Power.

The rate hike is a ripple effect of a recent federal appeals court ruling in a lawsuit filed against the Bonneville Power Administration by public utilities.

The BPA is a not-for-profit federal agency that markets about 40 percent of the electricity consumed in the region and sells to about 140 utilities in Washington, Oregon, Idaho and Montana — most of them public utilities.

In a May 3 ruling, the 9th U.S. Circuit Court of Appeals said the BPA had previously overstepped its authority when it set an annual subsidy to reduce electricity rates for residential and small farm customers of the privately owned utilities.

The BPA and its utility customers have long fought over the appropriate level of the subsidy, known as the "residential exchange" program.

The exchange — established by the Northwest Power Act in 1980 — allows private utilities to swap higher-cost power they generate for lower-cost hydropower generated by the BPA. The exchange usually comes in the form of a financial payment, not an actual power exchange, and customers see it as a credit on their monthly bills.

The court decision did not require BPA to stop the payments. But earlier, BPA said it was immediately suspending payment of $28 million a month in residential exchange benefits because of uncertainty over the ruling.

"This is a distasteful thing to be forced to do," Lee Beyer, chairman of the Oregon utility commission, said in a statement regarding the recent rate hike. "Unfortunately BPA's decision to cut off customers of private utilities from the benefits of the Columbia River hydro system made this action necessary."

BPA said the agency is working with several groups in the Northwest to find a solution. The agency is also seeking a rehearing of the ruling by a larger panel of the 9th Circuit, but a final decision will be made by the Justice Department.

The issue has already built tension among the handful of large investor-owned utilities against scores of publicly owned utilities in a fight over access to BPA's low-cost hydropower.

However, some of the utilities say they are open to a compromise as well. PGE spokesman Steve Corson said the utility is fighting for customer rights but recognizes some options, such as a rehearing or legislative decisions, could take significant amounts of time to resolve.

Northwest senators have also urged the BPA to look for a compromise in the battle brewing between public and private utilities. Without such a compromise, Congress could step in, with unknown consequences for the BPA and the utilities it serves, the senators said.

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New Jersey, New York suspending utility shut-offs amid coronavirus pandemic

NY & NJ Utility Shutoff Moratorium suspends power, heat, and water disconnections amid COVID-19, as PSEG, Con Edison, Avangrid, and American Water pledge relief, supporting vulnerable customers with payment plans and health protections.

 

Key Points

A temporary pause on power, heat, and water shutoffs during COVID-19, as major utilities act to protect affected customers.

✅ Applies to power, gas, and water; restores prior shutoffs.

✅ Voluntary utility action; no PSC order required in NY.

✅ Initial moratorium runs through April; payment plans available.

 

New Jersey and New York utilities will keep the power, heat and water on for all customers in response to the coronavirus emergency, both states announced Friday.

Major utilities have agreed to suspend utility shut-offs, a particular concern for people who may be out of work and cannot afford to pay their bills.

“No utility can turn off service … if a person cannot pay their bill as a result of responding to this virus situation,” said New York Gov. Andrew Cuomo during a press conference Friday.

Utilities in New York have voluntarily agreed to this measure, according to the governor’s office, reflecting a broader state moratorium on disconnections during emergencies. No order from the Public Service Commission is expected.

With growing concerns about the economic impacts of a virtual shutdown of businesses and large events to curtail the spread of the novel coronavirus, advocates are increasingly pushing financial relief for families amid pandemic energy insecurity pressures. There’s a campaign in New York to suspend evictions and foreclosures, with growing political support. A similar call has gone out in New Jersey.

As the weather warms, shut-offs of electric and gas service due to nonpayment tend to pick up. If people are quarantined or out of work due to a widespread economic slowdown, some advocates say they shouldn’t have to worry about having the lights or heat turned off, especially as examples of unpaid utility bills straining cities have emerged elsewhere.

“We recognize that customers may experience financial difficulty as a result of the outbreak, whether they or a family member fall ill, are required to quarantine, or because their income is otherwise affected,” said Michael Jennings, a spokesperson for Public Service Enterprise Group — the parent company of Public Service Electric and Gas Company, New Jersey’s largest utility — in a statement.

The company’s policy will be in place at least through the end of April, as will Atlantic City Electric’s, and other utilities such as PG&E's pandemic response included a similar moratorium during the outbreak.

“Curtailing shut-offs is good public policy to make sure New Jersey residents aren’t left in the lurch as they’re dealing with coronavirus,” said Eric Miller, director of the Natural Resources Defense Council’s New Jersey energy policy program. “Not having a safe place to be because you don't have electricity, gas or water doesn’t do anything to help address the coronavirus.”

Water service has also drawn attention. Major cities, including Atlanta and Detroit, have suspended shut-offs to ensure residents have water to wash their hands, while Texas utilities waived fees to support customers as well. Seattle suspended water and electric shutoffs.

American Water, which operates in 16 states and has 650,000 customers in New Jersey and 350,000 in New York, has halted any shutoffs amid the coronavirus pandemic and will also restore service, and similarly Hydro One reconnected customers in Canada to maintain access. New York City does not shut off service for nonpayment, but does issue liens against people’s property.

“Everyone, regardless as to what industry, has to have a heightened responsibility that’s encompassed in compassion and take everything into consideration,” New Jersey state Sen. Teresa Ruiz (D-Essex) told POLITICO. “Now is not the time to be worrying about late payments or bills. We need to get past this, hopefully, to see what we’re facing and then deal with other things.”

PSEG Long Island, a subsidiary of PSEG that handles day-to-day operations for the Long Island Power Authority, was the first New York utility to announce it is also suspending shutoffs before the governor’s announcement. The moratorium will remain in place through the end of April.

Rich Berkley, with the Public Utility Law Project, which advocates for low-income customers in New York, said he’s been in touch with state officials to make sure the issue of utility bills is considered during the pandemic. New York already has requirements for utilities to offer deferred payment agreements before shutting off service, he noted.

“The state has to act to protect the most vulnerable households first,” he said. “To the extent that the state is declaring areas of emergency, this should be part of the remedies the state deploys.”

But he noted that not everyone will have trouble paying their utility bills if they’re under quarantine.

“Given the background of a collapsing stock and equity market, all of which matters to the utilities, and shifts in electricity demand during COVID-19, we have to be careful about blanket moratoriums [on shutoffs] in New York,” Berkley said.

Con Edison, the largest utility in the state serving most of New York City, had already informed the Department of Public Service it will suspend all shut-offs in the one-mile radius New Rochelle containment area, spokesperson Michael Clendenin said on Thursday. The moratorium on shutoffs now includes its entire New York City and Westchester County territory.

Avangrid, which owns New York State Electric & Gas and Rochester Gas & Electric, serving broad swathes of upstate New York, will suspend shut-offs due to unpaid bills for 30 days, spokesperson Michael Jamison said.

 

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Disruptions in the U.S. coal, nuclear power industries strain the economy and invite brownouts

Electric power market crisis highlights grid reliability risks as coal and nuclear retire amid subsidies, mandates, and cheap natural gas; intermittent wind and solar raise blackout concerns, resilience costs, and pricing distortions across regulated markets.

 

Key Points

Reliability and cost risks as coal and nuclear retire; subsidies distort prices; intermittent renewables strain grid.

✅ Coal and nuclear retirements reduce baseload capacity

✅ Subsidies and mandates distort market pricing signals

✅ Intermittent renewables increase blackout and grid risk

 

Is anyone paying any attention to the crisis that is going on in our electric power markets?

Over the past six months at least four major nuclear power plants have been slated for shutdown, including the last one in operation in California. Meanwhile, dozens of coal plants have been shuttered as well — despite low prices and cleaner coal. Some of our major coal companies may go into bankruptcy.

This is a dangerous game we are playing here with our most valuable resource — outside of clean air and water. Traditionally, we've received almost half our electric power nationwide from coal and nuclear power, and for good reason. They are cheap sources of power and they are highly resilient and reliable.

The disruption to coal and nuclear power wouldn't be disturbing if this were happening as a result of market forces. That's only partially the case.

#google#

The amazing shale oil and gas revolution is providing Americans with cheap gas for home heating and power generation. Hooray. The price of natural gas has fallen by nearly two-thirds over the last decade and this has put enormous price pressure on other forms of power generation.

But this is not a free-market story of Schumpeterian creative destruction. If it were, then wind and solar power would have been shutdown years ago. They can't possibly compete on a level playing field with $3 natural gas.

In most markets solar and wind power survive purely because the states mandate that as much as 30 percent of residential and commercial power come from these sources. The utilities have to buy it regardless of price, even as electricity demand is flat in many regions. What a sweet deal. The California state legislature just mandated that every new home spend $10,000 on solar panels on the roof.

Well over $100 billion of subsidies to big wind and big solar were doled out over the last decade, and even with the avalanche of taxpayer subsidies and bailout funds many of these companies like Solyndra (which received $500 million in handouts) failed, underscoring why a green revolution hasn't materialized as promised.

These industries are not anywhere close to self sufficiency. In 2017 amid utility trends to watch the wind industry admitted that without a continuation of a multi-billion tax credit, the wind turbines would stop turning.

This combines with the left's war on coal through regulations that have destroyed coal plants in many areas. (Thank goodness for the exports of coal or the industry would be in much bigger trouble.)

Bottom line: Our power market is a Soviet central planner's dream come true and it is extinguishing our coal and nuclear industries.

 

Why should anyone care?

First, because government subsidies, regulations and mandates make electric power more expensive. Natural gas prices have fallen by two-thirds, but electric power costs have still risen in most areas — thanks to the renewable mandates.

More importantly, the electric power market isn't accurately pricing in the value of resilience and reliability. What is the value of making sure the lights don't go off? What is the cost to the economy and human health if we have rolling brownouts and blackouts because the aging U.S. grid doesn't have enough juice during peak demand.

Politicians, utilities and federal regulators are shortsightedly killing our coal and nuclear capacities without considering the risk of future energy shortages and power disruptions. Once a nuclear plant is shutdown, you can't just fire it back up again when you need it.

Wind and solar are notoriously unreliable. Most places where wind power is used, coal plants are needed to back up the system during peak energy use and when the wind isn't blowing.

The first choice to fix energy markets is to finally end the tangled web of layers and layers of taxpayer subsidies and mandates and let the market choose. Alas, that's nearly impossible given the political clout of big wind and solar.

The second best solution is for the regulators and utilities to take into account the grid reliability and safety of our energy. Would people be willing to pay a little more for their power to ensure against brownouts? I sure would. The cost of having too little energy far exceeds the cost of having too much.

A glass of water costs pennies, but if you're in a desert dying of thirst, that water may be worth thousands of dollars.

I'll admit I'm not sure what the best solution is to the power plant closures. But if we have major towns and cities in the country without electric power for stretches of time because of green energy fixation, Americans are going to be mighty angry and our economy will take a major hit.

When our manufacturers, schools, hospitals, the internet and iPhones shut down, we're not going to think wind and solar power are so chic.

If the lights start to go out five or 10 years from now, we will look back at what is happening today and wonder how we could have been so darn stupid.

 

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Heathrow Airport Power Outage: Vulnerabilities Flagged Days Before Disruption

Heathrow Airport Power Outage 2025 disrupted operations with mass flight cancellations and diversions after a grid failure, exposing infrastructure resilience gaps, crisis management flaws, and raising passenger compensation and safety oversight concerns.

 

Key Points

A grid failure closed Heathrow, causing mass cancellations and diversions, exposing resilience and communication lapses.

✅ Grid fire triggered airport-wide shutdown

✅ 1,400+ flights canceled or diverted

✅ Inquiry probes resilience, communication, compensation

 

On March 21, 2025, Heathrow Airport, Europe's busiest, suffered a catastrophic power outage, similar to another high-profile outage seen at major events, that led to the cancellation and diversion of over 1,400 flights, affecting nearly 300,000 passengers and costing airlines an estimated £100 million. The power failure, triggered by a fire at an electricity substation in west London, left Heathrow with a significant operational crisis. This disruption is even more significant considering that Heathrow is one of the most expensive airports globally, which raises concerns about its infrastructure resilience and broader electricity system resilience across Europe.

In a parliamentary committee meeting, Heathrow officials admitted that vulnerabilities in the airport’s power supply were flagged just days before the outage. Nigel Wicking, Chief Executive of the Heathrow Airline Operators' Committee (HAOC), informed MPs that concerns regarding power resilience had been raised on March 15, following disruptions caused by cable thefts impacting runway lights. Despite these warnings, the airport’s management did not address the vulnerabilities urgently, even as UK net zero policies continue to reshape infrastructure planning, which ultimately led to the disastrous outage.

The airport was closed for a day, with serious consequences for not only airlines but also the surrounding community and businesses. British Airways alone faced millions of pounds in losses, and passengers experienced significant emotional distress, missing vital life events like weddings and funerals due to flight cancellations. The committee is now questioning officials from National Grid and Scottish and Southern Electricity Networks to better understand why Heathrow’s infrastructure failed, in the context of a cleaner grid following the British carbon tax that reduced coal use, how it communicated with affected parties, and what measures will be taken to compensate impacted passengers.

Heathrow’s Chief Executive, Thomas Woldbye, defended the closure decision, stating it would have been disastrous to keep the airport open under such circumstances. He noted that continuing operations would have left tens of thousands of passengers stranded and would have posed safety risks due to the failure of fire surveillance and CCTV systems. However, Wicking, representing the airlines, pointed out that Heathrow’s lack of resilience was unacceptable given the amount spent on the airport, emphasizing the need for better infrastructure, including addressing SF6 in switchgear during upgrades, and more transparent management practices.

Looking forward, the MPs intend to investigate the airport’s emergency preparedness, why the resilience review from 2018 wasn’t shared with airlines, and whether enough preventative measures were in place amid surging data demand that could strain electricity supplies. The outcome of this inquiry could have lasting effects on how Heathrow and other major airports handle their infrastructure and crisis management systems, as drought-driven hydro challenges demonstrate the wider climate stresses on power networks.

 

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Berlin Geothermal Plant in El Salvador Set to Launch This Year

El Salvador Geothermal Expansion boosts renewable energy with a 7 MW Berlin binary ORC plant, upgrades at Ahuachapan, and pipeline projects, strengthening clean power capacity, grid reliability, and sustainable growth in Central America.

 

Key Points

A national push adding binary-cycle capacity at Berlin and Ahuachapan, boosting geothermal supply and advancing sites.

✅ 7 MW Berlin binary ORC plant entering service.

✅ Ahuachapan upgrade adds 2 MW, total geothermal 204 MW.

✅ Next: Chinameca, San Miguel, San Vicente, World Bank backed.

 

El Salvador is set to expand its renewable energy capacity with the inauguration of the 7-MW Berlin binary geothermal power plant, slated to go online later this year. This new addition marks a significant milestone in the country’s geothermal energy development, highlighting its commitment to sustainable energy solutions. The plant, which has already been installed and is currently undergoing testing, is expected to boost the nation’s geothermal capacity, contributing to its growing renewable energy portfolio.

The Role of Geothermal Energy in El Salvador’s Energy Mix

Geothermal energy plays a pivotal role in El Salvador's energy landscape. With the combined output from the Ahuachapan and Berlin geothermal plants, geothermal energy now accounts for about 21% of the country's net electricity supply. This makes geothermal the second-largest source of energy generation in El Salvador, underscoring its importance as a reliable and sustainable energy resource alongside emerging options like advanced nuclear microreactor technologies in the broader low-carbon mix.

In addition to the Berlin plant, El Salvador has made significant improvements to its Ahuachapan geothermal power plant. Recent upgrades have increased its generation capacity by 2 MW, further enhancing the country’s geothermal energy output. Together, the Ahuachapan and Berlin plants bring the total installed geothermal capacity to 204 MW, positioning El Salvador as a regional leader in geothermal energy development.

The Berlin Binary Geothermal Plant: A Technological Milestone

The Berlin binary geothermal power plant is especially noteworthy for several reasons. It is the first geothermal power plant to be constructed in El Salvador since 2007, marking a significant step in the country's ongoing efforts to expand its renewable energy infrastructure while reinforcing attention to risk management in light of Hawaii geothermal safety concerns reported elsewhere. The plant utilizes a binary cycle geothermal system, which is known for its efficiency in extracting energy from lower temperature geothermal resources, making it an ideal solution for regions like Berlin, where geothermal resources are abundant but at lower temperatures.

The plant was built by Turboden, an Italian company specializing in organic Rankine cycle (ORC) technology. The binary cycle system operates by transferring heat from the geothermal fluid to a secondary fluid, which then drives a turbine to generate electricity. This system allows for the efficient use of geothermal resources that might otherwise be too low in temperature for traditional geothermal plants, enabling pairing with thermal storage demonstration solutions to optimize output.

Future Geothermal Developments in El Salvador

El Salvador is not stopping with the Berlin geothermal plant. The country is actively working on other geothermal projects, including those in Chinameca, San Miguel, and San Vicente. These developments are expected to add 50 MW of additional capacity in their first phase, reflecting a broader shift as countries pursue hydrogen-ready power plants to reduce emissions, with a second phase, supported by the World Bank, planned to add another 100 MW.

The Chinameca, San Miguel, and San Vicente projects represent the next wave of geothermal development in El Salvador. When completed, these plants will significantly increase the country’s geothermal capacity, further diversifying its energy mix and reducing reliance on fossil fuels, and will require ongoing grid upgrades, a task complicated elsewhere by Germany grid expansion challenges highlighted in Europe.

International Support and Collaboration

El Salvador’s geothermal development efforts are supported by various international partners, including the World Bank, which has been instrumental in financing the expansion of geothermal projects, as utilities such as SaskPower geothermal plans in Canada explore comparable pathways. This collaboration highlights the global recognition of El Salvador’s potential in geothermal energy and its efforts to position itself as a hub for geothermal energy development in Central America.

Additionally, the country’s expertise in geothermal energy, especially in binary cycle technology, has attracted international attention. El Salvador’s progress in the geothermal sector could serve as a model for other countries in the region that are looking to harness their geothermal resources to reduce energy costs and promote sustainable energy development.

The upcoming launch of the Berlin binary geothermal power plant is a testament to El Salvador’s commitment to sustainable energy. As the country continues to expand its geothermal capacity, it is positioning itself as a leader in renewable energy in the region. The binary cycle technology employed at the Berlin plant not only enhances energy efficiency but also demonstrates El Salvador’s ability to adapt and innovate within the renewable energy sector.

With the continued development of projects in Chinameca, San Miguel, and San Vicente, and ongoing international collaboration, El Salvador’s geothermal energy sector is set to play a crucial role in the country’s energy future. As global demand for clean energy grows, exemplified by U.S. solar capacity additions this year, El Salvador’s investments in geothermal energy are helping to build a more sustainable, resilient, and energy-independent future.

 

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Setbacks at Hinkley Point C Challenge UK's Energy Blueprint

Hinkley Point C delays highlight EDF cost overruns, energy security risks, and wholesale power prices, complicating UK net zero plans, Sizewell C financing, and small modular reactor adoption across the grid.

 

Key Points

Delays at EDF's 3.2GW Hinkley Point C push operations to 2031, lift costs to £46bn, and risk pricier UK electricity.

✅ First unit may slip to 2031; second unit date unclear.

✅ LSEG sees 6% wholesale price impact in 2029-2032.

✅ Sizewell C replicates design; SMR contracts expected soon.

 

Vincent de Rivaz, former CEO of EDF, confidently announced in 2016 the commencement of the UK's first nuclear power station since the 1990s, Hinkley Point C. However, despite milestones such as the reactor roof installation, recent developments have belied this optimism. The French state-owned utility EDF recently disclosed further delays and cost overruns for the 3.2 gigawatt plant in Somerset.

These complications at Hinkley Point C, which is expected to power 6 million homes, have sparked new concerns about the UK's energy strategy and its ambition to decarbonize the grid by 2050.

The UK government's plan to achieve net zero by 2050 includes a significant role for nuclear energy, reflecting analyses that net-zero may not be possible without nuclear and aiming to increase capacity from the current 5.88GW to 24GW by mid-century.

Simon Virley, head of energy at KPMG in the UK, stressed the importance of nuclear energy in transitioning to a net zero power system, echoing industry calls for multiple new stations to meet climate goals. He pointed out that failing to build the necessary capacity could lead to increased reliance on gas.

Hinkley Point C is envisioned as the pioneer in a new wave of nuclear plants intended to augment and replace Britain's existing nuclear fleet, jointly managed by EDF and Centrica. Nuclear power contributed about 14 percent of the UK's electricity in 2022, even as Europe is losing nuclear power across the continent. However, with the planned closure of four out of five plants by March 2028 and rising electricity demand, there is concern about potential power price increases.

Rob Gross, director of the UK Energy Research Centre, emphasized the link between energy security and affordability, highlighting the risk of high electricity prices if reliance on expensive gas increases.

The first 1.6GW reactor at Hinkley Point C, initially set for operation in 2027, may now face delays until 2031, even after first reactor installation milestones were reported. The in-service date for the second unit remains uncertain, with project costs possibly reaching £46bn.

LSEG analysts predict that these delays could increase wholesale power prices by up to 6 percent between 2029 and 2032, assuming the second unit becomes operational in 2033.

Martin Young, an analyst at Investec, warned of the price implications of removing a large power station from the supply side.

In response to these delays, EDF is exploring the extension of its four oldest plants. Jerry Haller, EDF’s former decommissioning director, had previously expressed skepticism about extending the life of the advanced gas-cooled reactor fleet, but EDF has since indicated more positive inspection results. The company had already decided to keep the Heysham 1 and Hartlepool plants operational until at least 2026.

Nevertheless, the issues at Hinkley Point C raise doubts about the UK's ability to meet its 2050 nuclear build target of 24GW.

Previous delays at Hinkley were attributed to the COVID-19 pandemic, but EDF now cites engineering problems, similar to those experienced at other European power stations using the same technology.

The next major UK nuclear project, Sizewell C in Suffolk, will replicate Hinkley Point C's design, aligning with the UK's green industrial revolution agenda. EDF and the UK government are currently seeking external investment for the £20bn project.

Compared with Hinkley Point C, Sizewell C's financing model involves exposing billpayers to some risk of cost overruns. This, coupled with EDF's track record, could affect investor confidence.

Additionally, the UK government is supporting the development of small modular reactors, while China's nuclear program continues on a steady track, with contracts expected to be awarded later this year.

 

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Are Norwegian energy firms ‘best in class’ for environmental management?

CO2 Tax for UK Offshore Energy Efficiency can accelerate adoption of aero-derivative gas turbines, flare gas recovery, and combined cycle power, reducing emissions on platforms like Equinor's Mariner and supporting net zero goals.

 

Key Points

A carbon price pushing operators to adopt efficient turbines, flare recovery, and combined cycle to cut emissions.

✅ Aero-derivative turbines beat industrial units on efficiency

✅ Flare gas recovery cuts routine flaring and fuel waste

✅ Combined cycle raises efficiency and lowers emissions

 

By Tom Baxter

The recent Energy Voice article from the Equinor chairman concerning the Mariner project heralding a ‘significant point of reference’ for growth highlighted the energy efficiency achievements associated with the platform.

I view energy efficiency as a key enabler to net zero, and alongside this the UK must start large-scale storage to meet system needs; it is a topic I have been involved with for many years.

As part of my energy efficiency work, I investigated Norwegian practices and compared them with the UK.

There were many differences, here are three;


1. Power for offshore installations is usually supplied from gas turbines burning fuel from the oil and gas processing plant, and even as the UK's offshore wind supply accelerates, installations convert that to electricity or couple the gas turbine to a machine such as a gas compressor.

There are two main generic types of gas turbine – aero-derivative and industrial. As the name implies aero-derivatives are aviation engines used in a static environment. Aero-derivative turbines are designed to be energy efficient as that is very import for the aviation industry.

Not so with industrial type gas turbines; they are typically 5-10% less efficient than a comparable aero-derivative.

Industrial machines do have some advantages – they can be cheaper, require less frequent maintenance, they have a wide fuel composition tolerance and they can be procured within a shorter time frame.

My comparison showed that aero-derivative machines prevailed in Norway because of the energy efficiency advantages – not the case in the UK where there are many more offshore industrial gas turbines.

Tom Baxter is visiting professor of chemical engineering at Strathclyde University and a retired technical director at Genesis Oil and Gas Consultants


2. Offshore gas flaring is probably the most obvious source of inefficient use of energy with consequent greenhouse gas emissions.

On UK installations gas is always flared due to the design of the oil and gas processing plant.

Though not a large quantity of gas, a continuous flow of gas is routinely sent to flare from some of the process plant.

In addition the flare requires pilot flames to be maintained burning at all times and, while Europe explores electricity storage in gas pipes, a purge of hydrocarbon gas is introduced into the pipes to prevent unsafe air ingress that could lead to an explosive mixture.

On many Norwegian installations the flare system is designed differently. Flare gas recovery systems are deployed which results in no flaring during continuous operations.

Flare gas recovery systems improve energy efficiency but they are costly and add additional operational complexity.


3. Returning to gas turbines, all UK offshore gas turbines are open cycle – gas is burned to produce energy and the very hot exhaust gases are vented to the atmosphere. Around 60 -70% of the energy is lost in the exhaust gases.

Some UK fields use this hot gas as a heat source for some of the oil and gas treatment operations hence improving energy efficiency.

There is another option for gas turbines that will significantly improve energy efficiency – combined cycle, and in parallel plans for nuclear power under the green industrial revolution aim to decarbonise supply.

Here the exhaust gases from an open cycle machine are taken to a separate turbine. This additional turbine utilises exhaust heat to produce steam with the steam used to drive a second turbine to generate supplementary electricity. It is the system used in most UK power stations, even as UK low-carbon generation stalled in 2019 across the grid.

Open cycle gas turbines are around 30 – 40% efficient whereas combined cycle turbines are typically 50 – 60%. Clearly deploying a combined cycle will result in a huge greenhouse gas saving.

I have worked on the development of many UK oil and gas fields and combined cycle has rarely been considered.

The reason being is that, despite the clear energy saving, they are too costly and complex to justify deploying offshore.

However that is not the case in Norway where combined cycle is used on Oseberg, Snorre and Eldfisk.

What makes the improved Norwegian energy efficiency practices different from the UK – the answer is clear; the Norwegian CO2 tax.

A tax that makes CO2 a significant part of offshore operating costs.

The consequence being that deploying energy efficient technology is much easier to justify in Norway when compared to the UK.

Do we need a CO2 tax in the UK to meet net zero – I am convinced we do. I am in good company. BP, Shell, ExxonMobil and Total are supporting a carbon tax.

Not without justification there has been much criticism of Labour’s recent oil tax plans, alongside proposals for state-owned electricity generation that aim to reshape the power market.

To my mind Labour’s laudable aims to tackle the Climate Emergency would be much better served by supporting a CO2 tax that complements the UK's coal-free energy record by strengthening renewable investment.

 

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