Ban on building gas-fired power plants threatens skills and jobs

The Government’s two-year ban on the construction of further gas-fired power stations has cost up to 36,000 jobs and eroded the country’s skills base, an influential group of energy suppliers claimed this week.

Since the government introduced its stricter consents policy for such projects in late 1998, 15 applications to build gas-fired power stations totalling 5.8GW have been rejected.

The Pan-Industry Group Against Stricter Consents said this had led to the loss of £3bn of investment in the energy sector, including £1bn of offshore gas developments that would otherwise have gone ahead.

The group’s report, published this week, said the impact of this loss on the UK’s skills base was a `grave concern’, as companies in the sector had made staff redundant, cut back or axed training programmes, and in some cases withdrawn from the business.

`There is no doubt that the stricter consents policy has resulted in a skills drain in the UK,’ the report concluded. It said the job losses had cut across engineering, construction, installation and operations, as well as the offshore sector.

The group, whose members include Enron, InterGen, Thames Power, Alstom and the UK Offshore Operators’ Association, called on the government to end the ban before the new trading arrangements for the electricity industry are introduced. Only last week, the start of the new regime was delayed by a month until the end of November.

Peter Youngs, managing director of CalEnergy Gas (UK) who chairs the group, said: `We urge the government to set a clear date, as early as possible in October, for an end to this damaging policy.’

The ending of the moratorium is not expected to lead to a sudden rush of projects, however, as generators will need to assess the impact of the new arrangements on prices before committing themselves to further investment. There is also a market constraint, as the UK’s lack of manufacturing capability for large gas turbines and massive demand in the US is stretching worldwide capacity.

John Curran, technology development manager at the large generator TXU Power, said: `I think it’s very much a case of wait and see what the new market does.’ But he added it was `better to have the option’ of building more gas-fired plants.

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