I love the analysis, clarity and comment given by The Economist newspaper. It's not the only newspaper that is jacking up its prices, but even so, I was fairly gutted to see that my annual renewal will rise from £155 in January 2016 to £179 in January 2017. Yes, there's a paltry £10 discount for one year only, for taking the Direct Debit option, and there are multi-year options but these demand a big up-front payment. It's a hell of a jump.
I decided to look at prices paid over the last 10 years and compare them against UK Consumer Price Inflation. This year the difference between the inflation-adjusted price, £134, and the inflated price, is £45. That's not a happy sight for anyone on a fixed income.
Method used: the Bank of England inflation calculator, which currently covers Consumer Price Inflation for years up to 2015, to work out inflation-adjusted prices based on £99 in 2006, and then use current number for UK 2016 CPI Average inflation given by inflation.eu to for the last point on the chart. Prices paid taken from my records.
Hinkley Point in Somerset is planned to become the site of a massive new nuclear reactor project, currently budgeted at £18 billion. The project will be executed and funded by EDF and China, with the return guaranteed by a deal to buy the electricity produced at a 'strike price' almost three times the current market rate (£92.50 per MWh compared with £33). This difference is estimated by the National Audit Office to be a £29.7 billion subsidy by consumers. Last night (28th July) we heard that the board of EDF had approved the deal and then shortly after, the welcome news that the UK Government had called a pause before contracts were signed.
Photo grabbed from order-order.com
The deal shows the cynicism of the Department of Energy and of politicians, both Labour and Conservative/LibDem coalition, who were quite happy to commit future generations to pay a huge amount for electricity to solve their planning problems. There is no way that Parliament would support a grant of £30 billion to EDF to build this plant; it may anyway have been an illegal state subsidy. Instead it was proposed to take the money through households' electricity bills over a 35 year period, a stealth tax on every user.
The Hinkley Point C plant is due to produce 3200 MW using the new and unproven European Pressurised Reactor technology. The first project for this reactor, in Finland, is currently 9 years late and £4 billion over budget. Every other project is late and over budget. No power is being produced commercially anywhere in the world with this design.
What would be a better solution? Submarines have been driven by small nuclear power plants for many years, and a similar Small Modular Reactor technology is now under development for civilian use. These can be produced more or less on a production line, and sited closer to the end users, with benefits of the reuse of excess heat for municipal heating. At say 160 MW each, only 20 would be needed to supply the same amount of power as Hinkley Point C. Rolls Royce is a leader in this field. Let's hope that the new UK Government stops the white elephant project in Somerset before too much more money has been sunk into it.