Hydro-Quebec would get the majority of NB Power's assets under a proposed agreement worth nearly $5 billion signed by New Brunswick Premier Shawn Graham and Quebec Premier Jean Charest.
According to the memorandum of understanding, Hydro-Quebec would buy the assets for $4.75 billion – an amount equivalent to NB Power's debt – giving Quebec greater capacity to export power to the United States.
Hydro-Quebec would assume NB Power assets such as transmission lines, offices and most generation facilities including the Point Lepreau nuclear power plant.
"This agreement... will also provide Quebec with a strategic geographic position with regards to the markets of Atlantic Canada and New England," Charest told a news conference.
The premiers of Nova Scotia and Newfoundland and Labrador have warned the deal would give Hydro-Quebec a monopoly that could hinder other power development in the region.
But Charest said he supports the continuation of an open market on the use of transmission lines and would not stand in the way of other provinces getting their power to the U.S.
As a precondition to the negotiations, New Brunswick and Quebec have agreed to new power rates for New Brunswick.
Residential power rates in New Brunswick would be frozen for five years, while industrial rates would be reduced to match those in Quebec, saving the Maritime province an estimated $5 billion.
"Ratepayers would see reduced rates to an extent that would have been impossible for NB Power as a stand-alone utility," Graham said.
NB Power was created by New Brunswick's legislature in 1920.
During the 2006 provincial election campaign, Graham promised to maintain the Crown corporation as a publicly owned utility.
But Graham said the deal would free New Brunswick of a large financial albatross.
"The elimination of NB Power's massive debt will help us attain self-sufficiency and relieve our children and grandchildren of this burden," he said.
New Brunswick Conservative Opposition Leader David Alward said the agreement would short-change his province because it would relinquish control of the province's power utility for little in return.
"Delay this deal until after the fixed election date of next September," Alward said.
"If not, then go to the people now."
But Graham said there will be opportunity for public debate before the closing date of the deal at the end of March 2010.
Under terms of the agreement, New Brunswick would continue to operate fossil fuel plants at Coleson Cove and Belledune, but phase out the facility at Dalhousie.
Hydro-Quebec could also direct the province to shut down two other fossil fuel facilities and earn emission credits in return.
BC Hydro SAP Oversight Report assesses B.C. Utilities Commission findings on misleading testimony, governance failures, public funds oversight, IT project risk, compliance gaps, audit controls, ratepayer impacts, and regulatory accountability in major enterprise software decisions.
Key Points
A summary of BCUC findings on BC Hydro's SAP IT project oversight, governance lapses, and regulatory compliance.
✅ BCUC probed testimony, cost overruns, and governance failures
✅ Project split to avoid scrutiny; incomplete records and late corrections
✅ Reforms pledged: stronger business cases, compliance, audit controls
B.C. Hydro misled the province’s independent regulator about an expensive technology program, thereby avoiding scrutiny on how it spent millions of dollars in public money, according to a report by the B.C. Utilities Commission.
The Crown power corporation gave inaccurate testimony to regulators about the software it had chosen, called SAP, for an information technology project that has cost $197 million, said the report.
“The way the SAP decision was made prevented its appropriate scrutiny by B.C. Hydro’s board of directors and the BCUC, reflecting governance risks seen in Manitoba Hydro board changes in other jurisdictions,” the commission found.
“B.C. Hydro’s CEO and CFO and its (audit and risk management board committee) members did not exhibit good business judgment when reviewing and approving the SAP decision without an expenditure approval or business case, highlighting how board upheaval at Hydro One can carry market consequences.”
The report was the result of a complaint made in 2016 by then-opposition NDP MLA Adrian Dix, who alleged B.C. Hydro lied to the regulatory commission to try to get approval for a risky IT project in 2008 that then went over budget and resulted in the firing of Hydro’s chief information officer.
The commission spent two years investigating. Its report outlined how B.C. Hydro split the IT project into smaller components to avoid scrutiny, failed to produce the proper planning document when asked, didn’t disclose cost increases of up to $38 million, reflecting pressures seen at Manitoba Hydro's debt across the sector, gave incomplete testimony and did not quickly correct the record when it realized the mistakes.
“Essentially all of the things I asserted were substantiated, and so I’m pleased,” Dix, who is now minister of health, said on Monday. “I think ratepayers can be pleased with it, because even though it was an elaborate process, it involves hundreds of millions of spending by a public utility and it clearly required oversight.”
The BCUC stopped short of agreeing with Dix’s allegation that the errors were deliberate. Instead it pointed toward a culture at B.C. Hydro of confusion, misunderstanding and fear of dealing with the independent regulatory process.
“Therefore, the panel finds that there was a culture of reticence to inform the BCUC when there was doubt about something, even among individuals that understood or should have understood the role of the BCUC, a pattern that can fuel Hydro One investor concerns in comparable markets,” read the report.
“Because of this doubt and uncertainty among B.C. Hydro staff, the panel finds no evidence to support a finding that the BCUC was intentionally misled. The panel finds B.C. Hydro’s culture of reticence to be inappropriate.”
By law, B.C. Hydro is supposed to get approval by the commission for rate changes and major expenditures. Its officials are often put under oath when providing information.
B.C. Hydro apologized for its conduct in 2016. The Crown corporation said Monday it supports the commission’s findings and has made improvements to management of IT projects, including more rigorous business case analyses.
“We participated fully in the commission’s process and acknowledged throughout the inquiry that we could have performed better during the regulatory hearings in 2008,” said spokesperson Tanya Fish.
“Since then, we have taken steps to ensure we meet the highest standards of openness and transparency during regulatory proceedings, including implementing a (thorough) awareness program to support staff in providing transparent and accurate testimony at all times during a regulatory process.”
The Ministry of Energy, which is responsible for B.C. Hydro, said in a statement it accepts all of the BCUC recommendations and will include the findings as part of a review it is conducting into Hydro’s operations and finances, including its deferred operating costs for context, and regulatory oversight.
Dix, who is now grappling with complex IT project management in his Health Ministry, said the lessons learned by B.C. Hydro and outlined in the report are important.
“I think the report is useful reading on all those scores,” he said. “It’s a case study in what shouldn’t happen in a major IT project.”
Alberta Hydropower Potential highlights renewable energy, dams, reservoirs, grid flexibility, contrasting wind and solar growth with limited investment, regulatory hurdles, river basin resources, and decarbonization pathways across Athabasca, Peace, and Slave River systems.
Key Points
It is the technical capacity for new hydro in Alberta's river basins to support a more reliable, lower carbon grid.
✅ 42,000 GWh per year developable hydro identified in studies.
✅ Major potential in Athabasca, Peace, and Slave River basins.
✅ Barriers include high capital costs, market design, water rights.
When you think about renewable energy sources on the Prairies, your mind may go to the wind farms in southern Alberta, or even the Travers Solar Project, southeast of Calgary.
Most of the conversation around renewable energy in the province is dominated by advancements in solar and wind power, amid Alberta's renewable energy surge that continues to attract attention.
But what about Canada's main source of electricity — hydro power?
More than half of Canada's electricity is generated from hydro sources, with 632.2 terawatt-hours produced as of 2019. That makes it the fourth largest installed capacity of hydropower in the world.
But in Alberta, it's a different story.
Currently, hydro power contributes between three and five per cent of Alberta's energy mix, while fossil fuels make up about 89 per cent.
According to Canada's Energy Future report from the Canada Energy Regulator, by 2050 it will make up two per cent of the province's electricity generation shares.
So why is it that a province so rich in mountains and rivers has so little hydro power?
Hydro's history in Alberta
Hydro power didn't always make up such a small sliver of Alberta's electricity generation. Hydro installations began in the early 20th century as the province's population exploded.
Grant Berg looks after engineering for hydro for TransAlta, Alberta's largest producer of hydro power with 17 facilities across the province.
"Our first plant was Horseshoe, which started in 1911 that we formed as Calgary Power," he said.
"It was really in response to the City of Calgary growing and having some power needs."
Berg said in 1913, TransAlta's second installation, the Kananaskis Plant, started as Calgary continued to grow.
A historical photo of a hydro-electric dam in Kananaskis Alta. taken in 1914.
Hydro power plant in Kananaskis as seen in 1914. (Glenbow Archives)
Some bigger installations were built in the 1920s, including Ghost reservoir, but by mid-century population growth increased.
"Quite a large build out really, I think in response to the growth in Alberta following the war. So through the 1950s really quite a large build out of hydro from there."
By the 1950s, around half of the province's installed capacity was hydro power.
"Definitely Calgary power was all hydro until the 1950s," said Berg.
Hydro potential in the province
Despite the current low numbers in hydroelectricity, Alberta does have potential.
According to a 2010 study, there is approximately 42,000 gigawatt-hours per year of remaining developable hydroelectric energy potential at identified sites.
An average home in Alberta uses around 7,200 kilowatt-hours of electricity per year, meaning that the hydro potential could power 5.8 million homes each year.
"This volume of energy could be sufficient to serve a significant amount of Alberta's load and therefore play a meaningful role in the decarbonization of the province's electric system," the Alberta Electric System Operator said in its 2022 Pathways to Net-Zero Emissions report.
Much of that potential lies in northern Alberta, in the Athabasca, Peace and Slave River basins.
The AESO report says that despite the large resource potential, Alberta's energy-only market framework has attracted limited investment in hydroelectric generation.
Hydro power was once a big deal in Alberta, but investment in the industry has been in decline since the 1950s. Climate change reporter Christy Climenhaga explains why.
So why does Alberta leave out such a large resource potential on the path to net zero?
The government of Alberta responded to that question in a statement.
"Hydro facilities, particularly large scale ones involving dams, are associated with high costs and logistical demands," said the Ministry of Affordability and Utilities.
"Downstream water rights for other uses, such as irrigation, further complicate the development of hydro projects."
The ministry went on to say that wind and solar projects have increased far more rapidly because they can be developed at relatively lower cost and shorter timelines, and with fewer logistical demands.
"Sources from wind power and solar are increasingly more competitive," said Jean-Denis Charlebois, chief economist with the Canadian Energy Regulator.
Hydro on the path to net zero
Hydro power is incredibly important to Canada's grid, and will remain so, despite growth in wind and solar power across the province.
Charlebois said that across Canada, the energy make-up will depend on the province.
"Canadian provinces will generate electricity in very different ways from coast to coast. The major drivers are essentially geography," he said.
Charlebois says that in British Columbia, Manitoba, Quebec and Newfoundland and Labrador, hydropower generation will continue to make up the majority of the grid.
"In Alberta and Saskatchewan, we see a fair bit of potential for wind and solar expansion in the region, which is not necessarily the case on Canada's coastlines," he said.
And although hydro is renewable, it does bring its adverse effects to the environment — land use changes, changes in flow patterns, fish populations and ecosystems, which will have to be continually monitored.
"You want to be able to manage downstream effects; make sure that you're doing all the proper things for the environment," said Ryan Braden, director of mining and hydro at TransAlta.
Braden said hydro power still has a part to play in Alberta, even with its smaller contributions to the future grid.
"It's one of those things that, you know, the wind doesn't blow or the sun doesn't shine, this is here. The way we manage it, we can really support that supply and demand," he said.
Germany energy liquidity crisis is straining municipal utilities as gas and power prices surge, margin calls rise, and Russian supply cuts bite, forcing state support, interventions, and emergency financing to stabilize households and businesses.
Key Points
A cash squeeze on German municipal utilities as soaring gas and power prices trigger margin calls and funding gaps.
✅ Margin calls and spot-market purchases strain cash flow
✅ State liquidity lines and EU collateral support proposed
Germany’s fears that soaring power prices and gas prices could trigger a deeper crisis is starting to get real.
Several hundred local utilities are coming under strain and need support, according to the head of Germany’s largest energy lobby group. The companies, generally owned by municipalities, supply households and small businesses directly and are a key part of the country’s power and gas network.
“The next step from the government and federal states must be to secure liquidity for these municipal companies,” Kerstin Andreae, chairwoman of the German Association of Energy and Water Industries, told Bloomberg in Berlin. “Prices are rising, and they have no more money to pay the suppliers. This is a big problem.”
Germany’s energy crunch intensified over the weekend after Russia’s Gazprom PJSC halted its key gas pipeline indefinitely, a stark wake-up call for policymakers to reduce fossil fuel dependence. European energy prices have surged again amid concerns over shortages this winter and fears of a worst-case energy scenario across the bloc.
Many utilities are running into financial issues as they’re forced to cover missing Russian deliveries with expensive supplies on the spot market. German energy giant Uniper SE, which supplies local utilities, warned it will likely burn through a 7 billion-euro ($7 billion) government safety net and will need more help already this month.
Some German local utilities have already sought help, according to a government official, who asked not to be identified in line with briefing rules.
With Europe’s largest economy already bracing for recession, Chancellor Olaf Scholz’s administration is battling on several fronts, testing the government’s financial capacity. The ruling coalition agreed Sunday on a relief plan worth about 65 billion euros -- part of an emerging energy shield package to contain the fallout of surging costs for households and businesses.
Starting in October, local utilities will have to pay a levy for the gas acquired, which will further increase their financial burden, Andreae said.
Margin Calls European gas prices are more than four times higher than usual for this time of year, underscoring why rolling back electricity prices is tougher than it appears for policymakers, as Russia cuts supplies in retaliation for sanctions related to its invasion of Ukraine. When prices peak, energy companies have to pay margin calls, extra collateral required to back their trades.
Read more: Energy Trade Risks Collapsing Over Margin Calls of $1.5 Trillion
The problem has hit local utilities in other countries as well. In Austria, the government approved a 2 billion-euro loan for Vienna’s municipal utility last month.
The European Union is also planning help, floating gas price cap strategies among other tools. The bloc’s emergency measures will include support for electricity producers struggling to find enough cash to guarantee trades, according to European Commission President Ursula von der Leyen.
The situation has worsened in Germany as some of the country’s big gas importers are reluctant to sell more supplies to some of municipal companies amid fears they could default on payments, Andreae said.
Boeing 787 More-Electric Architecture replaces pneumatics with bleedless pressurization, VFSG starter-generators, electric brakes, and heated wing anti-ice, leveraging APU, RAT, batteries, and airport ground power for efficient, redundant electrical power distribution.
Key Points
An integrated, bleedless electrical system powering start, pressurization, brakes, and anti-ice via VFSGs, APU and RAT.
✅ VFSGs start engines, then generate 235Vac variable-frequency power
✅ Bleedless pressurization, electric anti-ice improve fuel efficiency
✅ Electric brakes cut hydraulic weight and simplify maintenance
The 787 Dreamliner is different to most commercial aircraft flying the skies today. On the surface it may seem pretty similar to the likes of the 777 and A350, but get under the skin and it’s a whole different aircraft.
When Boeing designed the 787, in order to make it as fuel efficient as possible, it had to completely shake up the way some of the normal aircraft systems operated. Traditionally, systems such as the pressurization, engine start and wing anti-ice were powered by pneumatics. The wheel brakes were powered by the hydraulics. These essential systems required a lot of physical architecture and with that comes weight and maintenance. This got engineers thinking.
What if the brakes didn’t need the hydraulics? What if the engines could be started without the pneumatic system? What if the pressurisation system didn’t need bleed air from the engines? Imagine if all these systems could be powered electrically… so that’s what they did.
Power sources
The 787 uses a lot of electricity. Therefore, to keep up with the demand, it has a number of sources of power, much as grid operators track supply on the GB energy dashboard to balance loads. Depending on whether the aircraft is on the ground with its engines off or in the air with both engines running, different combinations of the power sources are used.
Engine starter/generators
The main source of power comes from four 235Vac variable frequency engine starter/generators (VFSGs). There are two of these in each engine. These function as electrically powered starter motors for the engine start, and once the engine is running, then act as engine driven generators.
The generators in the left engine are designated as L1 and L2, the two in the right engine are R1 and R2. They are connected to their respective engine gearbox to generate electrical power directly proportional to the engine speed. With the engines running, the generators provide electrical power to all the aircraft systems.
APU starter/generators
In the tail of most commercial aircraft sits a small engine, the Auxiliary Power Unit (APU). While this does not provide any power for aircraft propulsion, it does provide electrics for when the engines are not running.
The APU of the 787 has the same generators as each of the engines — two 235Vac VFSGs, designated L and R. They act as starter motors to get the APU going and once running, then act as generators. The power generated is once again directly proportional to the APU speed.
The APU not only provides power to the aircraft on the ground when the engines are switched off, but it can also provide power in flight should there be a problem with one of the engine generators.
Battery power
The aircraft has one main battery and one APU battery. The latter is quite basic, providing power to start the APU and for some of the external aircraft lighting.
The main battery is there to power the aircraft up when everything has been switched off and also in cases of extreme electrical failure in flight, and in the grid context, alternatives such as gravity power storage are being explored for long-duration resilience. It provides power to start the APU, acts as a back-up for the brakes and also feeds the captain’s flight instruments until the Ram Air Turbine deploys.
Ram air turbine (RAT) generator
When you need this, you’re really not having a great day. The RAT is a small propeller which automatically drops out of the underside of the aircraft in the event of a double engine failure (or when all three hydraulics system pressures are low). It can also be deployed manually by pressing a switch in the flight deck.
Once deployed into the airflow, the RAT spins up and turns the RAT generator. This provides enough electrical power to operate the captain’s flight instruments and other essentials items for communication, navigation and flight controls.
External power
Using the APU on the ground for electrics is fine, but they do tend to be quite noisy. Not great for airports wishing to keep their noise footprint down. To enable aircraft to be powered without the APU, most big airports will have a ground power system drawing from national grids, including output from facilities such as Barakah Unit 1 as part of the mix. Large cables from the airport power supply connect 115Vac to the aircraft and allow pilots to shut down the APU. This not only keeps the noise down but also saves on the fuel which the APU would use.
The 787 has three external power inputs — two at the front and one at the rear. The forward system is used to power systems required for ground operations such as lighting, cargo door operation and some cabin systems. If only one forward power source is connected, only very limited functions will be available.
The aft external power is only used when the ground power is required for engine start.
Circuit breakers
Most flight decks you visit will have the back wall covered in circuit breakers — CBs. If there is a problem with a system, the circuit breaker may “pop” to preserve the aircraft electrical system. If a particular system is not working, part of the engineers procedure may require them to pull and “collar” a CB — placing a small ring around the CB to stop it from being pushed back in. However, on the 787 there are no physical circuit breakers. You’ve guessed it, they’re electric.
Within the Multi Function Display screen is the Circuit Breaker Indication and Control (CBIC). From here, engineers and pilots are able to access all the “CBs” which would normally be on the back wall of the flight deck. If an operational procedure requires it, engineers are able to electrically pull and collar a CB giving the same result as a conventional CB.
Not only does this mean that the there are no physical CBs which may need replacing, it also creates space behind the flight deck which can be utilised for the galley area and cabin.
A normal flight
While it’s useful to have all these systems, they are never all used at the same time, and, as the power sector’s COVID-19 mitigation strategies showed, resilience planning matters across operations. Depending on the stage of the flight, different power sources will be used, sometimes in conjunction with others, to supply the required power.
On the ground
When we arrive at the aircraft, more often than not the aircraft is plugged into the external power with the APU off. Electricity is the blood of the 787 and it doesn’t like to be without a good supply constantly pumping through its system, and, as seen in NYC electric rhythms during COVID-19, demand patterns can shift quickly. Ground staff will connect two forward external power sources, as this enables us to operate the maximum number of systems as we prepare the aircraft for departure.
Whilst connected to the external source, there is not enough power to run the air conditioning system. As a result, whilst the APU is off, air conditioning is provided by Preconditioned Air (PCA) units on the ground. These connect to the aircraft by a pipe and pump cool air into the cabin to keep the temperature at a comfortable level.
APU start
As we near departure time, we need to start making some changes to the configuration of the electrical system. Before we can push back , the external power needs to be disconnected — the airports don’t take too kindly to us taking their cables with us — and since that supply ultimately comes from the grid, projects like the Bruce Power upgrade increase available capacity during peaks, but we need to generate our own power before we start the engines so to do this, we use the APU.
The APU, like any engine, takes a little time to start up, around 90 seconds or so. If you remember from before, the external power only supplies 115Vac whereas the two VFSGs in the APU each provide 235Vac. As a result, as soon as the APU is running, it automatically takes over the running of the electrical systems. The ground staff are then clear to disconnect the ground power.
If you read my article on how the 787 is pressurised, you’ll know that it’s powered by the electrical system. As soon as the APU is supplying the electricity, there is enough power to run the aircraft air conditioning. The PCA can then be removed.
Engine start
Once all doors and hatches are closed, external cables and pipes have been removed and the APU is running, we’re ready to push back from the gate and start our engines. Both engines are normally started at the same time, unless the outside air temperature is below 5°C.
On other aircraft types, the engines require high pressure air from the APU to turn the starter in the engine. This requires a lot of power from the APU and is also quite noisy. On the 787, the engine start is entirely electrical.
Power is drawn from the APU and feeds the VFSGs in the engines. If you remember from earlier, these fist act as starter motors. The starter motor starts the turn the turbines in the middle of the engine. These in turn start to turn the forward stages of the engine. Once there is enough airflow through the engine, and the fuel is igniting, there is enough energy to continue running itself.
After start
Once the engine is running, the VFSGs stop acting as starter motors and revert to acting as generators. As these generators are the preferred power source, they automatically take over the running of the electrical systems from the APU, which can then be switched off. The aircraft is now in the desired configuration for flight, with the 4 VFSGs in both engines providing all the power the aircraft needs.
As the aircraft moves away towards the runway, another electrically powered system is used — the brakes. On other aircraft types, the brakes are powered by the hydraulics system. This requires extra pipe work and the associated weight that goes with that. Hydraulically powered brake units can also be time consuming to replace.
By having electric brakes, the 787 is able to reduce the weight of the hydraulics system and it also makes it easier to change brake units. “Plug in and play” brakes are far quicker to change, keeping maintenance costs down and reducing flight delays.
In-flight
Another system which is powered electrically on the 787 is the anti-ice system. As aircraft fly though clouds in cold temperatures, ice can build up along the leading edge of the wing. As this reduces the efficiency of the the wing, we need to get rid of this.
Other aircraft types use hot air from the engines to melt it. On the 787, we have electrically powered pads along the leading edge which heat up to melt the ice.
Not only does this keep more power in the engines, but it also reduces the drag created as the hot air leaves the structure of the wing. A double win for fuel savings.
Once on the ground at the destination, it’s time to start thinking about the electrical configuration again. As we make our way to the gate, we start the APU in preparation for the engine shut down. However, because the engine generators have a high priority than the APU generators, the APU does not automatically take over. Instead, an indication on the EICAS shows APU RUNNING, to inform us that the APU is ready to take the electrical load.
Shutdown
With the park brake set, it’s time to shut the engines down. A final check that the APU is indeed running is made before moving the engine control switches to shut off. Plunging the cabin into darkness isn’t a smooth move. As the engines are shut down, the APU automatically takes over the power supply for the aircraft. Once the ground staff have connected the external power, we then have the option to also shut down the APU.
However, before doing this, we consider the cabin environment. If there is no PCA available and it’s hot outside, without the APU the cabin temperature will rise pretty quickly. In situations like this we’ll wait until all the passengers are off the aircraft until we shut down the APU.
Once on external power, the full flight cycle is complete. The aircraft can now be cleaned and catered, ready for the next crew to take over.
Bottom line
Electricity is a fundamental part of operating the 787. Even when there are no passengers on board, some power is required to keep the systems running, ready for the arrival of the next crew. As we prepare the aircraft for departure and start the engines, various methods of powering the aircraft are used.
The aircraft has six electrical generators, of which only four are used in normal flights. Should one fail, there are back-ups available. Should these back-ups fail, there are back-ups for the back-ups in the form of the battery. Should this back-up fail, there is yet another layer of contingency in the form of the RAT. A highly unlikely event.
The 787 was built around improving efficiency and lowering carbon emissions whilst ensuring unrivalled levels safety, and, in the wider energy landscape, perspectives like nuclear beyond electricity highlight complementary paths to decarbonization — a mission it’s able to achieve on hundreds of flights every single day.
Great British Energy could cut UK electricity costs via public ownership, investing in clean energy like wind, solar, tidal, and nuclear, curbing windfall profits, stabilizing bills, and reinvesting returns through a state-backed generator.
Key Points
A proposed state-backed UK generator investing in clean power to cut costs and return gains to taxpayers.
✅ Publicly owned investment in wind, solar, tidal, and nuclear
✅ Cuts electricity bills by reducing generators' windfall profits
✅ Funded via bonds or asset buyouts; non-profit operations
A publicly owned electricity generation firm could save Britons nearly £21bn a year, according to new analysis that bolsters Labour’s case to launch a national energy company if the party gains power.
Thinktank Common Wealth has calculated that the cost of generating electricity to power homes and businesses could be reduced by £20.8bn or £252 per household a year under state ownership, according to a report seen by the Guardian.
The Labour leader, Keir Starmer, has committed to creating “a publicly owned national champion in clean energy” named Great British Energy.
Starmer is yet to lay out the exact structure of the mooted company, although he has said it would not involve nationalising existing assets, or become involved in the transmission grid or retail supply of energy.
Starmer instead hopes to create a state-backed entity that would invest in clean energy – wind, solar, tidal, nuclear, large-scale storage and other emerging technologies – creating jobs and ensuring windfalls from the growth in low carbon power feed back to the government.
The Common Wealth report, which analysed scenarios for reforming the electricity market, said that a huge saving on electricity costs could be made by buying out assets such as wind, solar and biomass generators on older contracts and running them on a non-profit basis. Funding the measure could require a government bond issuance, or some form of compulsory purchase process.
Last year the government attempted to get companies operating low carbon generators, including nuclear power plants, on older contracts to switch to contracts for difference (CfD), allowing any outsized profits to flow back to taxpayers. However, the government later decided to tax eligible firms through the electricity generator levy instead.
The Common Wealth study concluded that a publicly owned low carbon energy generator would best deliver on Britain’s climate and economic goals, would eliminate windfall profits made by generators and would cut household bills significantly.
MPs and campaigners have argued that Britain’s energy companies should be nationalised since the energy crisis, even as coal-free records have multiplied and renewables still need more support, which has resulted in North Sea oil and gas producers and electricity generators making windfall profits, and a string of retail suppliers collapsing, costing taxpayers billions. Detractors of nationalisation in energy argue it can stifle innovation and expose taxpayers to huge financial risks.
Common Wealth pointed out that more than 40% of the UK’s offshore wind generation capacity was publicly owned by overseas national entities, meaning the benefits of high electricity prices linked to the war in Ukraine had flowed back to other governments.
The study found the publicly owned generator model would create more savings than other options, including a drive for voluntary CfDs; splitting the generation market between low carbon and fossil fuel sources at a time when wind and solar have outproduced nuclear, and a “single buyer model” with nationalised retail suppliers.
U.S. Utility Spending Shift highlights rising transmission and distribution costs, grid modernization, and smart meters, while generation expenses decline amid fuel price volatility, capital and labor pressures, and renewable integration across the power sector.
Key Points
A decade-long trend where utilities spend more on delivery and grid upgrades, and less on electricity generation costs.
✅ Delivery O&M, wires, poles, and meters drive rising costs
✅ Generation spending declines amid fuel price changes and PPI
✅ Grid upgrades add reliability, resilience, and renewable integration
Over the past decade, major utilities in the United States have been spending more on delivering electricity to customers and less on producing that electricity, a shift occurring as electricity demand is flat across many regions.
After adjusting for inflation, major utilities spent 2.6 cents per kilowatthour (kWh) on electricity delivery in 2010, using 2020 dollars. In comparison, spending on delivery was 65% higher in 2020 at 4.3 cents/kWh, and residential bills rose in 2022 as inflation persisted. Conversely, utility spending on power production decreased from 6.8 cents/kWh in 2010 (using 2020 dollars) to 4.6 cents/kWh in 2020.
Utility spending on electricity delivery includes the money spent to build, operate, and maintain the electric wires, poles, towers, and meters that make up the transmission and distribution system. In real 2020 dollar terms, spending on electricity delivery increased every year from 1998 to 2020 as utilities worked to replace aging equipment, build transmission infrastructure to accommodate new wind and solar generation amid clean energy transition challenges that affect costs, and install new technologies such as smart meters to increase the efficiency, reliability, resilience, and security of the U.S. power grid.
Spending on power production includes the money spent to build, operate, fuel, and maintain power plants, as well as the cost to purchase power in cases where the utility either does not own generators or does not generate enough to fulfill customer demand. Spending on electricity production includes the cost of fuels including natural gas prices alongside capital, labor, and building materials, as well as the type of generators being built.
Other utility spending on electricity includes general and administrative expenses, general infrastructure such as office space, and spending on intangible goods such as licenses and franchise fees, even as electricity sales declined in recent years.
The retail price of electricity reflects the cost to produce and deliver power, the rate of return on investment that regulated utilities are allowed, and profits for unregulated power suppliers, and, as electricity prices at 41-year high have been reported, these components have drawn increased scrutiny.
In 2021, demand for consumer goods and the energy needed to produce them has been outpacing supply, though power demand sliding in 2023 with milder weather has also been noted. This difference has contributed to higher prices for fuels used by electric generators, especially natural gas. The increased cost for fuel, capital, labor, and building materials, as seen in the U.S. Bureau of Labor Statistics’ Producer Price Index, is increasing the cost of power production for 2021. U.S. average electricity prices have been higher every month of this year compared with 2020, according to our Monthly Electric Power Industry Report.
