James Moore: Nuclear power may not look cheap now, but there are other benefits

Outlook. Also: Hedge funds and retail investor campaigns  have brought about a volte face at Co-op

Welcome (back) to the nuclear future. The Government pushed the button yesterday, announcing a deal for the first new plant in a generation with the help of France’s EDF Energy and other overseas investors.

The price? Electricity, when the plant comes on stream, at roughly twice what it costs today. A price which has been guaranteed to the investors.

If only we could use the heat of controversy to power turbines, because that fact has generated enough to keep the country going over the next decade, during which old coal plants will go offline without anything to replace them. 

What the critics don’t know, however, is what electricity prices will look like by the time the new plant is turned on. What has been guaranteed now could actually seem like a very reasonable price then.

It is true that some people get excited about a wave of supposedly cheap energy that could be produced from natural gas released through fracking. But those who live next door to where it’s supposed to take place get even more excited. And not in a good way.

Fracking aside, even at the agreed price nuclear is still considerably cheaper than other low carbon alternatives: offshore and onshore wind, for example. It’s also more reliable.

Despite the fuss over recent price rises, we’re still enjoying relatively cheap electricity by European standards. The problem is we haven’t been investing. As a result, those rises may be just the start of it, regardless of what Ed Miliband would have you believe.

That isn’t to ignore the environmental issues, and the potential risks of nuclear. And I am wholly in favour of research and investment into renewables. I am equally in favour of boosting this country’s energy efficiency – cut demand and you need less of a supply – through, say, offering tax breaks or grants to householders and businesses.

But it chills me that we live in a country where people are facing the choice of food or fuel. Unless we act, more and more people are going to find themselves facing that evil dilemma.

Nuclear might not look all that cheap today, but it is part of the solution and comes with the substantial spin-off benefits of producing lots of high quality jobs in the construction phase. The economy could certainly do with the power that they’ll provide.

Co-operative it may  be. But ethical?

After telling everyone who cared to listen that there was no plan B for the Co-operative Bank, now, it seems, there is.

Initially bondholders were told they would have to accept their holdings being converted into shares amounting to 25 per cent of a recapitalised bank that would be majority owned by the Co-operative Group.  Or the alternative was to wind the thing up.

Now, following sustained pressure from hedge funds, not to mention the doughty efforts of Mark Taber on behalf of retail bondholders, there’s been a volte face such that Co-op will get something like 30 per cent. Not plan B, Co-op people say, more like A plus. Or perhaps A starred. What next? AAA?

Actually that might be pushing it a bit far. There’s nothing AAA about this. Trading in Co-op bonds was suspended yesterday pending a further announcement which will presumably fill in details that were notably lacking.

Trust us, the Co-op is saying, we’ll see the retail bondholders right. Meanwhile the hedge funds and City investors who look set to get the majority of the shares in the institution will jolly well have to behave themselves, because this will still be the “ethical” bank. See, it’s being written into the constitution.

This is supposed to reassure those who hold the view that “hedge fund” and “ethical” are mutually exclusive terms. Most of the Co-operative Bank’s customers have remained remarkably loyal to a business that hasn’t done much to deserve it.

Whether they will stay on board now is open to question. Co-op Group, with its 30 per cent share, can argue that it will still have de-facto control. And this is true. Not only will it be the biggest individual shareholder, it in effect holds the whip hand.

It’s just that it’s very hard to trust Co-op as the guardian of a bank’s ethics given the recent history. And that includes the last few months, when it told everyone who cared to listen that the first offer was the only game in town…

The new bank regulator has done its job

One thing to be thankful for is that the Co-operative Bank won’t call upon the taxpayer’s purse.

That counts as a victory for the Prudential Regulation Authority, even if the way the episode has been handled has been criticised in several quarters. The Co-op has been a test case for its new regulatory set up, and it has done its job.

Assuming the deal announced yesterday doesn’t hit any further bumps in the road, attention should now shift to the Financial Conduct Authority.

The fact that the Co-op won’t be a burden on the state shouldn’t be allowed to detract from what has been an appalling scandal that has left thousands of individual bond-holders out of pocket while tarnishing the name of one of Britain’s best loved brands.

The Treasury Select Committee has picked this one up as part of its investigation into Co-op’s failed attempt to buy Verde from Lloyds. Peter Marks, former Co-operative Group chief executive, gives evidence today.

It wouldn’t do much for the FCA’s credibility were the committee eventually to produce another report questioning why it had failed to pursue those responsible for another scandal.

Start your day with The Independent, sign up for daily news emails
ebooks
ebooksA celebration of British elections
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Claims Administrator

£16000 - £18500 per annum: Recruitment Genius: This is an excellent opportunit...

Recruitment Genius: Senior SEO Executive

£24000 - £28000 per annum: Recruitment Genius: A Senior SEO Executive is requi...

Recruitment Genius: Online Customer Service Administrator

£16000 - £18000 per annum: Recruitment Genius: An Online customer Service Admi...

Recruitment Genius: Digital Marketing Executive

£18000 - £22000 per annum: Recruitment Genius: This global, industry leading, ...

Day In a Page

Fishing for votes with Nigel Farage: The Ukip leader shows how he can work an audience as he casts his line to the disaffected of Grimsby

Fishing is on Nigel Farage's mind

Ukip leader casts a line to the disaffected
Who is bombing whom in the Middle East? It's amazing they don't all hit each other

Who is bombing whom in the Middle East?

Robert Fisk untangles the countries and factions
China's influence on fashion: At the top of the game both creatively and commercially

China's influence on fashion

At the top of the game both creatively and commercially
Lord O’Donnell: Former cabinet secretary on the election and life away from the levers of power

The man known as GOD has a reputation for getting the job done

Lord O'Donnell's three principles of rule
Rainbow shades: It's all bright on the night

Rainbow shades

It's all bright on the night
'It was first time I had ever tasted chocolate. I kept a piece, and when Amsterdam was liberated, I gave it to the first Allied soldier I saw'

Bread from heaven

Dutch survivors thank RAF for World War II drop that saved millions
Britain will be 'run for the wealthy and powerful' if Tories retain power - Labour

How 'the Axe' helped Labour

UK will be 'run for the wealthy and powerful' if Tories retain power
Rare and exclusive video shows the horrific price paid by activists for challenging the rule of jihadist extremists in Syria

The price to be paid for challenging the rule of extremists

A revolution now 'consuming its own children'
Welcome to the world of Megagames

Welcome to the world of Megagames

300 players take part in Watch the Skies! board game in London
'Nymphomaniac' actress reveals what it was really like to star in one of the most explicit films ever

Charlotte Gainsbourg on 'Nymphomaniac'

Starring in one of the most explicit films ever
Robert Fisk in Abu Dhabi: The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers

Robert Fisk in Abu Dhabi

The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers
Vince Cable interview: Charging fees for employment tribunals was 'a very bad move'

Vince Cable exclusive interview

Charging fees for employment tribunals was 'a very bad move'
Iwan Rheon interview: Game of Thrones star returns to his Welsh roots to record debut album

Iwan Rheon is returning to his Welsh roots

Rheon is best known for his role as the Bastard of Bolton. It's gruelling playing a sadistic torturer, he tells Craig McLean, but it hasn't stopped him recording an album of Welsh psychedelia
Russell Brand's interview with Ed Miliband has got everyone talking about The Trews

Everyone is talking about The Trews

Russell Brand's 'true news' videos attract millions of viewers. But today's 'Milibrand' interview introduced his resolutely amateurish style to a whole new crowd
Morne Hardenberg interview: Cameraman for BBC's upcoming show Shark on filming the ocean's most dangerous predator

It's time for my close-up

Meet the man who films great whites for a living