UK should not rescue B.Energy-green group
Date: 19-Sep-02
Country: UK
"The government should offer no bailout for British Energy but instead force the company into administration," Bill Eyre, chairman of SERA, the Socialist Environment and Resources Association, whose membership includes over 100 Labour members of parliament and four ministers, said in a statement.
"There should be no handout for a lame duck business."
Last week the government gave British Energy, the country's largest generator, a 410 million pound ($631.5 million) temporary loan after the firm warned it was facing insolvency because of low UK power prices.
The emergency funding runs out on September 27 and the government has yet to decide whether to continue funding the company, which was privatised in 1996, or send it into administration.
SERA, said the loan should be repaid immediately with the company sent into administration and its nuclear power stations overseas sold.
Its eight nuclear plants in the UK, which probably could not be sold because of because of huge decommissioning and waste management liabilities, should be transferred to the new nuclear Liabilities Management Authority which is being set up.
SERA said the government's energy policy, due to be detailed in a white paper early next year, should focus on phasing out nuclear power quickly and boost investment in renewable power and energy efficiency measures.
"We believe it is in the best interests of the taxpayer to phase out nuclear power rapidly as to do otherwise would lead to mounting economic losses that would ultimately fall to the public to pay," said Eyres.
Earlier yesterday, Dieter Helm, a top academic and an influence in government, said UK consumers should be forced to buy nuclear power to rescue British Energy and support the struggling nuclear sector.
Helm argued nuclear power should be supported by similar rules to those which help green energy by providing a guaranteed market for renewable power producers.
British Energy shares continued their relentless slide yesterday, down another 25 percent to 9-1/2 pence. The stock has lost around 90 percent of its value since September 6 when the company said it faced insolvency and begged the government for help.
Shareholders fear their investment will be wiped out if British Energy is allowed to collapse.
The company's bond due 2006 was bid at 40 percent of face value and the 2003 bond at 42 percent. Both were up around five points after Tuesday's savage drop, triggered by another downgrade of British Energy's credit rating.
