Monday 17 September 2012

Japan’s nuclear bail out ‘won’t affect UK power prices’

Japan's plan to ditch nuclear power and use gas instead "shouldn't have any major impact" on UK energy prices and access to gas supply.

Risk experts believe Japan's increased dependence on gas in the short-term is unlikely to affect UK gas prices.

Andrew Horstead at energy and carbon management specialists Utilyx said: “UK gas prices have been more or less stable even after the Fukushima incident because even though LNG imports to the UK have decreased by around 33% the shortfall has been made up by pipeline imports from Norway.

"The UK’s dependency on imports will inevitably increase over the coming period as production from the North Sea continues to decline but Japanese demand for LNG will remain more or less stable in the short and medium terms as gas-powered generators are operating close to capacity in Japan."

However nuclear analysts say the Japanese policy change could "pose a challenge" to other sectors such as renewables.

Chris Gadomski, Lead Analyst for Nuclear at Bloomberg New Energy Finance said: “How well these technologies can respond without higher electricity prices and without increasing greenhouse gas emissions from stand-by and back-up fossil technologies will be closely scrutinised by politicians and industry alike."