Robin Pagnamenta, Energy and Environment Editor
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British companies are being forced to pay over four times more for their electricity this winter than competitors in France and in excess of 70 per cent more than in Germany.
The discrepancy will increase concerns that Britain's crumbling power infrastructure is a growing threat to the country's competitiveness and comes as Ofgem today announces its report into competition in the energy market.
Wholesale power prices in the UK have soared because of a squeeze in generating capacity, which is expected to leave an unusually thin margin of spare supply next month.
On Friday, the forward price of power for November reached more than £130 per megawatt hour. In France, it was about €40 (£31) per megawatt hour, according to Spectron, a supplier of energy market data. In Germany, the price stood at around €97 per megawatt hour.
Jeremy Nicholson, of the Energy Intensive Users' Group, gave warning that some British companies could close this winter because they will not be able to pay such high prices. Power-hungry industries such as brickmaking, cement, glassmaking and papermills are particularly at risk.
“Companies that are unhedged and are having to buy power at or close to the spot price are really struggling,” he said. “If we don't see prices come down, then there is a very real risk of production shutdowns.”
The high UK prices are the result of the closure of a number of ageing nuclear and coal-fired plants for repairs, which has reduced generating capacity. Prices are expected to fall towards the end of the year as nuclear plants at Dungeness, Heysham and Hartlepool return to service.
National Grid insisted this week that there was sufficient capacity to meet demand this winter. In France, 78 per cent of electricity is generated from nuclear energy, which has been unaffected by high oil and coal prices, and its generating plants, much more modern than those in the UK, offset the problem of capacity shortfall.
Retail customers are not directly affected by the high wholesale price, although there are fears that continued upward pressure on prices could force power suppliers to raise bills again next year.
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We have shorttermist politicians, the French have a culture of statist planning. France is reaping the rewards of a Colbertian faith in the state. They support small farmers and state railways too, with beneficial results.
C Smith, Norwich, UK
The 5% increase in the population over the last decade will not have helped. This was deliberate, but to recognise the consequenses to our energy supplies would have meant admitting what everyone could see but the government denied.
D.L. Stephens, York, England
It is disingenuous to say that this is a problem created by politicians. It was created by our illustrious Civil Service who have no long term interest in the prosperity of the British nation and instead centre their concerns on retaining the status quo. Their allegiance is to themselves not the nation
Chris Coles, Medstead, Alton, United Kingdom
Labour has over the last 11 years had the opportunity to put as a priority the security of our energy supply. Instead, Brown and Blair chose to squander our money on the cynical pursuit of securing their own stayoin office. Now, Brown has sold our national energy security to the French.
Karen , London, UK
How would re-nationalising the energy industry make it better??
The reason it was de-regulated was to save costs (which it has) and increase efficency (again it has).
EDF will be good for teh industry. Investors from abroad are good things when will we learn that lesson.
Colin, Portsmouth, UK
Did you know solar energy is only £700 for a 2 bedroom house, and £1300 for a 4 bedroom house on ebay nowadays.
Government subsidery is about £2500 the retail price is 50% below
Even government help is out of date to the pricing of alternative energy
Buy solar and invest in the saving in
Nicholas Iles, Oswestry, Shropshire, United Kingdom
The Tories started the crisis almost 20 years ago, but with the Labour cabinet having no industrial experience, they were beguiled by claims that claims that wind could replace coal and nuclear
Paul , northwich,
France does so well in electricity prices because it didn't sell its electricity generators to foreign businessmen. When electricity was privatised leaked documents revealed that the private buyers were going to close old power stations to save money and acknowledged this could cause black-outs.
Ben Galim, Haifa, Israel
Of course, the French don't have the same kind of stupid government that we have EdF which is taking over another chunk of our enery supply sector is still 80% government controlled.
bob holmes, Axbridge, England
This has new labour writen all over it, so how many labour backers and doners are making money this time?
Just build a load of nucular ones and be done with it, we going need 40 times more power any way once we all have electric cars.
MR W Jones, Liverpool, England
Lucky!? France has always wanted an independent energy source from USA-UK controlled petroleum based energy. The French have always heavily invested in fast rail links. This is called planning for the future. In Montpellier we will open our 3rd Tramline in 5 years. My kids take theTramway everyday!
Gary lawrence, Montpellier, France
How many more times?? Electricity and gas are provided by PRIVATE companies not the government. All you "Sids" out there were quite happy to make a huge profit on the sale. Firms squeeze their assets. They don't mothball plant "just in case" Renationalise anyone?
Markham, Huddersfield, UK
We should have ignored the nimbys and invested in Nuclear years ago.
People want more electricty, turning the thermostat down by 1 degree is laughable.
Colin Ling, Colchester,
Why do you think EDF(state owned french energy company) bought just recently British Energy. There is money to be made in England, by french expats, cheaper than the british workers!
But seeing such a prfitable market in England, I am worrying for our futur french energy prices. Buy a windmill!!!
Emile Schoegje, Archingeay, France
Why not Nationalize the power industriy in the U/K stop depending on the free market it does not work there must be some thing in the middle ? We will loss more industry as Environmentalist in the U/K are better lobbist than the power industry. but not the same in other countries.
Chris Welch, Luton, U/K
No wonder, everything is more dear in UK than anywhere else in Europe, but still our piliticians refuse to take notice and qe continue to pay. No wonder this country is going bust.
Lec Neli, London, UK
Nuclear - the only way forward. Yet why are the government dithering? The electorate elected a government to govern, get on with it and get started on replacement and new nuclear power stations as a matter of urgency
PB, Anglesey, Wales
No one's to blame. Who could have predicted a growing demand for electricity or power stations wearing out?
France just got lucky I suppose.
John Carr, Coussac Bonneval, France
Why not buy it off the French then?
Mike, Sydney,
New Labour have had 11 years to devise a coherent long term energy policy. But as usual they have prevaricated and dissembled, while selling off this country's assets behind the scenes. Future historians will look back on this period of government as an unmitigated disaster.
Dwight Vandryver, Scholar Green, UK
frankly this could have been avoided had politicians not listened to nimbys and eco-mentalists.
There was not bottle to resolve it when we had the chance.
hop the nimbys are happy now..
billy, edinburgh,
I don't think it's exaggerating to say that we have no idea how to run an energy policy in the UK. The multiples above are scary but still nothing is done. When the lights go out in a year or two, the search for scapegoats will start. Meanwhile, we should ask ourselves why France does it so well.
Colin, shrewsbury,
Could it be that the nefarious oil companies, with their search for bonanza bonuses are a threat to the country as a whole? Shock horror no!
It doesn't take a genius to see that a newer technology such as nuclear power is the only common sense way of keeping up with growing energy needs.
G Davidson, Kashiwa, Japan