New Greenpeace challenge to British Energy rescue
Date: 14-Feb-03
Country: UK
Author: Stuart Penson
British Energy is surviving on a 650-million pounds ($1.05 billion) state loan, granted late last year after plunging UK power prices in Britain's cut-throat energy market forced it to the brink of insolvency in September.
Greenpeace, which wants the plug pulled on all British Energy's nuclear plants and has unsuccessfully challenged the loan in the UK courts, said it would seek annulment in the European Court of the European Commission's recent decision to approve the state aid.
"The European Commission has approved a loan to British Energy which is unfairly distorting the UK electricity market," said Greenpeace's nuclear campaigner Jim Footner in a statement.
"Their reasoning is based on a misunderstanding of the facts and does not take into account the alternatives to this massive bail out of nuclear power."
Neither British Energy nor the UK's Department of Trade and Industry, which is steering the rescue attempt, could immediately be reached for comment.
British Energy"s shares were up three percent at 6.8 pence.
Wednesday's move came before the expected agreement on Friday by British Energy bondholders on the first steps towards restructuring the company.
British Energy needs 50 percent of its bondholders to sign standstill agreements by Friday, allowing the firm to suspend principal repayments due in March and keeping it out of administration.
The nuclear giant won some breathing space last week when it sold a chunk of its output over the next four years to UK utility Centrica in a deal analysts said was worth at least 600 million pounds.
But industry sources said the fixed prices set in contract were below current market levels.
Earlier this week British Energy paid off its discredited former executive chairman Robin Jeffrey at reduced terms.
Jeffrey quit last year after management blunders contributed to the company's crisis.
