Energy Minister Nick Drew*, in the comments to his own post on Kingsnorth, Coal and a New Dash For Gas:
... delaying the decommissioning might be a low-cost option in some instances ... but it's not necessarily so, beyond a couple of years extra lifespan:
- the plants-to-be-decommissioned were nominated (by their owners) quite a few years ago, on the grounds that there was no economic way to clean them up. As such they really are probably rubbish, and will mostly have had only basic safety-type maintenance done on them since that decision. But capital plant needs constant upgrading-type maintenance to give it a decent lifespan, so their demise is now almost inevitable
- the owners generally see more value in these plants as brown-field sites for new plants in due course. This is because (a) permitting for new large power-plants on greenfield sites is really, really difficult across all of Europe and (b) choice sites (with good access to cooling water, transport links etc) are at a premium even without permitting problem.
It's the last paragraph that chimes with me. One fairly ridiculous way of dismissing Georgists' economic analysis is to accuse them of being obsessed with land, and to say that land is not important to a modern economy ("I'm typing this from my lap-top. I don't need land for that!"). OK, but lap-tops need electricity, which comes from power stations.
Superficially, how much land does a power station need? A few hundred acres perhaps, it doesn't need to be particularly fertile or anything, it's not like agriculture... but it needs all the things that ND mentions, and it burns coal, oil or gas that are derived from land; and it can't be too far from major cities/factories because for every pilon and substation between it and the customer it has to battle for planning permission and make 'wayleave' payments.
The cost/value of the land is not in the inherent value of the land (you can snap up a few hundred acres of farmland for a few million quid, peanuts to a power company) but in all the planning permission and hassle. There are trade-offs - near a town means more customers, shorter power cables, easier to get employees to maintain the thing; but near a town also means more objections from residents (we all want electricity but nobody wants to live near a power station. Funny, that). Similarly, land prices near a town are higher; but land prices further out into the countryside are much lower (but then you get the Greenie lobby crying doubly foul, etc).
So as ND suggests, once you have 'banked' that planning permission, you can allow your old power station to disintegrate (gleefully encouraged to do so by the EU, of course, we're best off out sharpish, different topic) but the site retains an enormous amount of value as the potential site for a replacement power station. So the old power company is no longer a power company, it's a land speculator.
Putting the whole global-cooling-peak-oil debate to one side for now, is it better to tax a power station on the value of electricity it generates (which discourages electricity generation) or to reduce taxes on that and increase the tax on the site value (which for these purposes means Business Rates) thus discouraging, or at least reducing the rewards to property speculation and indirectly encouraging them to keep the plant in good working order?
Just sayin', is all.
* Well he is in my Bloggers Cabinet anyway.
Wednesday, 14 October 2009
Siting power stations
Subscribe to:
Post Comments (Atom)
7 comments:
not only greens complain about power sites in the country
R, greenies and NIMBYs both. But where are we supposed to put all this stuff that everybody needs but nobody wants near their house, like airports, roads, rail, gasometers, sewage works, power stations, prisons etc?
Mark, where the poor people live, of course.
ISTR being told that the supermarkets were really property development companies that happened to flog some groceries as a sideline - they made most of their profits from developing land for new stores. Not sure how true this is today as we approach the Tesco event horizon....
B, but do they site these things where poor people live, or do poor people have to live there because it's cheaper (and that's where they work)?
As to Tesco, I'm afraid to say that is probably true (as much as I love shopping at Tesco). They buy up sites just for the fun of putting restrictive covenants on them that they can't be used to sell groceries and then sell them on. Or they buy up sites and just leave them derelict to stymie the competition. Business Rates for derelict sites (aka Land Value Tax) would sort that out, of course.
I think someone have to break the ground for that.
Mark, both, I think. The poor tend to care less for aesthetics and more for the realities of life, like having a job.
Thinking about power stations, I would have thought we have enough of them already, in numerical terms. If more capacity is needed, which seems unlikely with everyone being urged to economise by the Warmist preachers, then existing sites could be used for more powerful stations. OTOH, I suppose replacements are needed for the likes of Battersea, Bankside and other inner-city stations.
As you say the amount of land used by nuclear plants is minimal. Any rates not designed to hurt them would be of minimal cost - not even within orders of magnitude of all the costs of 10 years of inquiries before being allowed to move earth. Something the French dud was to require them to supply electricity at cost within a few miles of the plant. Strangely communities there compete to get them in their back yards.
Post a Comment