Minister expects no fall in energy prices
24 Jun 2006
Energy minister Malcolm Wicks is not confident that energy prices will fall despite the infrastructure improvements that are underway.
A gas pipeline link with Norway is scheduled to come on stream in the winter of 2007 and a terminal is being built in Milford Haven to handle liquefied natural gas from Qatar. However, the minister — who acknowledges that the decline in North Sea energy supplies has been faster than expected — could not assure a special delegation from the British Plastics Federation that prices will tumble as a result.
More worryingly, said the BPF, this is likely to lead to increased speculation on the uncertainty surrounding energy supplies, which, in turn, will exacerbate cost pressures during the coming winter.
Plastics processors have been hit hard by rising energy costs and the effects of the Climate Change Levy. Former BPF president Brian Mann, managing director of McKechnie Plastic Components, explained to the minister that a key reason for his recent closure of the company's Burnett Polymers plant, in Northampton, was a doubling of energy costs between 2003 and 2006.
More optimism was registered with BPF director Peter Davis regarding a levelling of the European energy playing field. He said he had been assured Malcolm Wicks and EU commissioners are pushing hard for the liberalisation of European energy markets.
The BPF is a keen advocate of energy from waste and was encouraged to hear that the secretary of state would make a decision "quite soon" on the long-standing planning application for a plant in Belvedere, Kent. This is seen as critical in helping to solve London's waste problem, with landfills in Essex due for imminent closure.
