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Region's firms in line for nuclear windfall



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Published Date:
21 October 2008
WHEN French energy giant EDF announced its £12.5bn takeover of British Energy, there were fears that Britain's nuclear power stations were falling into foreign hands.
But EDF has made it clear that on top of its plans to sell a 25 per cent stake to British Gas parent Centrica, it is keen to form partnerships with British companies.

It is good news for a number of Yorkshire companies including Leeds-based Spice, Wakefield-based Redhall and MG Bennett of Rotherham, which was bought by WS Atkins, Europe's biggest engineering consultant, earlier this month.

Under the terms of the deal EDF plans to ramp up Britain's nuclear energy development, building four new reactors in the UK.

British Energy owns eight nuclear plants and the Eggborough coal-fired power station in North Yorkshire and produces about a sixth of Britain's electricity.

EDF wants to build and run two reactors at Hinkley Point in Somerset and another two at Sizewell in Suffolk, which are both existing British Energy sites.

While Britain's nuclear power plants provide 19 per cent of our electricity, all but one of the plants are due to close within 15 years. This means huge investment will be needed over the coming years to build new sites and this is where Yorkshire's companies come in.

Energy services company Spice told the Yorkshire Post it is gearing up for major expansion once EDF completes its takeover.

EDF is Spice's biggest customer and it accounts for 17 per cent of the Leeds-based company's turnover.

Spice will be in line for a number of new contracts once EDF goes ahead with plans to build the four nuclear reactors at Hinkley Point and Sizewell.

Spice, which joined the FTSE 250 earlier this month following rapid expansion over the past year, provides technical resources to EDF.

Spice chief executive Simon Rigby said: "EDF will need more pylons and cables to connect its power stations to the national grid. Any construction of generating capacity in the UK is good news for us. This is a tremendous opportunity for Spice."

Spice has plans to double the size of its business over the next five years.

Mr Rigby said: "It shows the real economy is still alive and well in Yorkshire despite the current economic turmoil. We have employed traditional Yorkshire values with a sensible business practice – borrow but don't borrow a lot."

In Wakefield, specialist engineer Redhall Group has been building for the nuclear expansion for a number of years. The group has embarked on an acquisition and growth strategy to give it the scale to compete for large contracts.

"We are trying to build a support services business that's capable of supporting the infrastructure and growth," said Redhall chief executive David Jackson. "The idea is to have a resource available for the nuclear new build."

In May, Redhall was awarded preferred bidder status for a £22m four-year contract at Sellafield nuclear plant. Under the terms of the contract Redhall will supply plant and equipment for Sellafield's Thorp reprocessing facility.

Earlier this year it also signed a deal with French nuclear services group Onet Technologies, a firm with strong links to EDF.

Redhall reached an agreement with Onet, the leading French nuclear waste decommissioning company, to provide nuclear services to both British and European companies. The deal also lets Redhall pitch for larger nuclear contracts in Britain. In the past Redhall has been too small to be considered for big nuclear contracts which have gone to larger rivals such as Balfour Beatty and Amec.

Rotherham-based MG Bennett also stands to gain. The group was taken over by WS Atkins, Europe's biggest engineering consultant earlier this month in a £2.5m deal.

Chris Ball, director of the nuclear business at Atkins, said Bennett will boost Atkins's nuclear design capability.

"Bennett has a very high reputation in the nuclear sector and a strong track record in defence and decommissioning," he said.

The company specialises in mechanical and structural engineering, particularly the lifting and handling of nuclear-related materials.

Mr Ball said the enlarged Atkins group will have an important role to play in the construction of EDF's four nuclear power plants.

"This acquisition will ensure we have the skills in place to respond to increased demand in the new build, decommissioning and generation markets," he said.

Nick Cooper, managing director of MG Bennett and one of the founding shareholders, said: "We look forward to working with the teams in Atkins to provide solutions to the challenging opportunities in the nuclear industry."

EDF has made it clear that British interests will be key to its future strategy and these contracts will go a long way to dispelling
fears that the French plan to ride roughshod over British interests.

DIARY OF DELAYS AND FAILURE IN BRITISH NUCLEAR PLANTS

British Energy's ageing nuclear power stations have been dogged by repairs and closures.

One of the reactors at Hinkley Point B in Somerset is due to restart in December due to maintenance. The plant is currently operating at a reduced level of about 70 per cent of full output – capable of supplying more than one million homes. Built between 1967 and 1975, it is due to be decommissioned in 2016.

Heysham 1 near Morecambe is capable of 1,160 megawatt (MW) output – more than 1.5 million homes. Its two reactors were built between 1970 and 1984 and it is due to be decommissioned in 2014. Work on one of its reactors is taking longer than expected and is only likely to restart next year.

One of the two reactors Heysham 2 near Lancaster is also being repaired and is due to restart in November. The site has a net output of 1,230 MW,capable of supplying more than 1.5 million homes. Built between 1979 and 1988 its estimated decommissioning date is 2023.

Hartlepool's two reactors are capable of 1,190 MW output. However, one reactor is out of action and due to restart early next year.

Hartlepool is capable of supplying more 1.5 million households at peak production and was built between 1969 and 1984. It is due to be decommissioned in 2014.

One of two reactors at Dungeness B in Kent is expected to restart in December after maintenance work.

With a net output of 1,090 MW, it is capable of supplying more than 1.5 million homes at peak output. It was built between 1965 and 1985 and is due to be decommissioned in 2018.

Torness on the east coast of Scotland has two reactors and is capable of supplying more than 1.5 million homes with its 1,250 MW output. It was built between 1980 and 1988 and is due to be decommissioned in 2023.

Sizewell B in Suffolk has a net electrical output 1,188 MW and is capable of supplying more than 1.5 million homes. The station supplies three per cent of the UK's electricity needs and has one reactor. Built between 1988 and 1995, it is due to be decommissioned in 2035.

Hunterston B on the west coast of Scotland has a net electrical output of 840 MW. It is operating at a reduced level of about 70 per cent of full output – capable of supplying one million homes. With two reactors, it was built between 1967 and 1976 and is due to be decommissioned in 2016.

The full article contains 1251 words and appears in n/a newspaper.
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  • Last Updated: 21 October 2008 10:02 AM
  • Source: n/a
  • Location: Yorkshire
 
 

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