Select Committee on Science and Technology Appendices to the Minutes of Evidence


APPENDIX 10

Memorandum submitted by the Advanced Power Generation Technology Forum

  The Advanced Power Generation Technology Forum (APGTF), a Foresight Associate Programme, provides the focus for the UK Power Generation Sector on power generation technologies for fossil fuels, biomass and associated technologies.

A broad range of interests is represented on the APGTF, mainly through the key Trade Associations involving the power generators and users, equipment manufacturers and fuel suppliers (namely Electricity Association, Association Electricity Producers, Combined Heat and Power Association, BEAMA/Power Generation Contractors Association and COALPRO) together with representatives from the Research Community, Government (DTI, DTI-OST and DTI-SEPU) and the Funding Agencies (EPSRC).

  The members of the APGTF have a prominent place in the important UK Power Generation Industry which had total exports exceeding £1.6 Billion in 2000[5], the prime markets being Asia and the Americas. A recent study on behalf of DTI showed the annual total turnover of companies in the UK fossil power generation equipment supply chain to be well in excess of £27 billion (probably around £40 billion).[6] The sector is an important employer of engineers, technologists and skilled tradesmen providing over 150,000 high quality jobs. It is well supported by the UK science and education base, which complements the in-house R&D resources of the companies.

  The APGTF endorses the Government's goals for Energy Policy:

    —  security of supply;

    —  major reductions of emissions of greenhouse gases; and

    —  competitiveness and affordability.

  These are truly international objectives, which need to be achieved against a background of growing demand for electric power worldwide (15,000 billion Kwh in 2000 to 24,000 billion Kwh in 2020)[7] and an insatiable growth in energy use (and associated CO2 emissions) from the transport sector.

  The members of the APGTF can contribute to achieving these objectives for the UK and internationally through: supply of new cleaner, safer and more efficient power plant; retrofit of emissions control and carbon management technologies to existing plant; high quality and cost-effective operation and engineering support for power stations. In so doing the Industry will continue to sustain high-grade employment, maintain skills and contribute to the balance of payments and to the country's science, technology and engineering base.

  With respect to the Science and Technology Committee's own enquiry we have prepared comments against each of the Terms of Reference and present these below:

1.  To evaluate the level of expenditure on RD&D in non-carbon energy technologies, by UK government, the Research Councils, the Carbon Trust and industry, and where it is being directed

  We would like to see an analysis of expenditure in the UK. Our perception is that funding is much greater—even on a pro rata basis—in the USA and the USA gives much greater support to demonstration of first-of-class technologies. For example, President Bush has recently committed 2 billion USD in federal cost sharing support to the Clean Coal Power Initiative (CCPI) over the next 10 years. In the first round of proposals (2002) the DOE plans to award 330MUSD.

2.  To identify which technologies are, or should be, receiving support, and how much investment is directed at research, development and demonstration respectively

  Government should not attempt to pick winners. A balance of energy sources is necessary for power generation and transport and a variety of developing technologies should be supported at the Research, Development and Demonstration stages. These technologies should include those directed at reducing carbon emissions from plants which use fossil fuels, recognising that global carbon emissions will only be possible if emissions from existing plants are tackled.

3.  To assess the skills base and the state of RD&D for different technologies

  We believe the skills base in Universities and Industry (in both equipment supply companies and utilities) is relatively strong but this will only remain the case if industry is seen to have a long-term future.

4.  To establish how government policy on energy RD&D is formulated, implemented and evaluated, and the nature of co-ordination between department, external agencies and industry

  We believe industry should be consulted to a greater extent than in the past. The DTI's Cleaner Coal R&D Programme is a good example of this. More involvement of the industry is needed in the planning of University R&D. The latest Scottish Executive initiative looks promising in this respect. Our response to the Energy Policy Review makes some specific recommendations on co-ordination, implementation and industrial involvement; we would like to see these implemented.

5.  To establish the level of and rationale for international collaboration in energy RD&D and how the priorities are determined

  We consider it essential that the UK takes a prominent role in the formulation of the EU's policies for RD&D but we caution against allowing this to become a substitute for a national programme.

6.  To examine the effect on energy RD&D of privatisation, liberalisation, regulation and changes in ownership in the sector

  Privatisation has had a negative effect on R&D. Support for industrial R&D from the former CEGB ended with privatisation and has not been replaced. The generation companies are increasingly risk averse—not surprising in view of the difficult commercial situation for this sector. At the moment, the market drives towards cheapest electricity; this provides a disincentive towards energy efficiency, new plant investment and fuel diversity. A different set of market conditions or signals needs to be provided in order to create a stable situation.

7.  To make comparisons with overseas competitors

  See 1. above.

17 September 2002




5   DTI Report Competitiveness Analysis of the UK Fossil Fuel Power Generation Equipment Industry. Back

6   Report for DTI "Supply Chain in the UK Fossil Fuel Power Generation Sector" by S Harrison and N Holmes. Back

7   The Financial Times. 4 June 2001. Back


 
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