Electricity Industry

UK - Market Report 2009 Sixth Edition

Publication Date	August 2009
Publisher	Key Note
Product Type	Report
Pages	114
ISBN Number	978-1-84729-501-9
Product Code	KEY00170

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Summary

This Key Note Market Report examines the UK electricity industry in terms of the fundamental activities of generation, transmission, distribution and supply. Between 2005 and 2008, UK final electricity consumption declined year-on-year, and finished at 339,914 gigawatt-hours (GWh) in 2008. Factors contributing to this included a decline in the manufacturing sector, the large loss of office jobs in 2008 and efforts by consumers to contain energy costs during the economic downturn. In 2007, the main final demand for electricity arose from the industrial (34.4%) and domestic (33.6%) sectors. By value, the domestic sector accounts for the largest sales.

Many UK power stations are approaching the end of their useful life and it is estimated that a third of UK generating capacity must be replaced by 2020. Currently, fossil fuels account for the majority of electricity generation, with gas holding the largest share of the market, and this will continue to be the case at least until 2020. Due to increasingly tough measures on environmental issues, the industry will be required to find methods of reducing carbon emissions in the process of burning coal and gas. Some generating companies plan to build new coal-fired power stations, but the Government has decided that a proportion of the capacity of these stations must have carbon capture and storage (CCS) facilities, and has launched a scheme to subsidise four of the eight proposed sites. Eventually, all new coal-fired power stations will be required to include CCS schemes.

A decision has now been made to allow private companies to build new nuclear power stations, and it is anticipated that work can begin in 2013/2014, with operation beginning between 2017 and 2020. Land is currently being purchased for these sites. Renewable energy is growing as a source of electricity, but it is expensive, and some companies in this sector are campaigning for more Government support.

To improve efficiency in meter reading and to give customers more control over their energy consumption, the Government has announced that all homes in Britain will have smart meters by 2020. This major project will involve the installation of remotely read meters in 26 million homes and several million businesses.

Forecasting the electricity industry is extremely difficult due to the current downturn in the UK economy, and factors such as high unemployment, contractions in gross domestic product (GDP) and fluctuations in oil prices are likely to impact on the market between 2009 and 2013. According to the Department for Business, Innovation and Skills (BIS), gas will continue to be the dominant fuel used for electricity generation, and its share of the market (by terawatt-hours [TWh]) will increase from 36.7% in 2005 to 53.1% by 2020.

Content

Executive Summary
1. Market Definition
- Report Coverage3
  - Generation
  - Transmission
  - Distribution
  - Supply
- Market Sectors
- Market Trends
- Economic Trends
  - Population
  - Table 1.1: UK Resident Population Estimates by Sex (000), Miyears 2004-2008
  - Gross Domestic Product
  - Table 1.2: UK Gross Domestic Product at Current and Annual Chailinked Prices(??m), 2004-2008inflation
  - Table 1.3: UK Rate of Inflation (%), 2004-2008unemployment
  - Table 1.4: Actual Number of Unemployed Persons in The UK (Million), 2004-2008 Household Disposable Income
  - Table 1.5: UK Household Disposable Income per Capita (??), 2004-20089
- Market Position
  - The UK
  - Table 1.6: UK Production of Primary Fuels by Type by Volume(Million Tonnes of Oil Equivalent), 2004-2008
  - Figure 1.1: UK Production of Primary Fuels by Type by Volume(Million Tonnes of Oil Equivalent), 2004-2008
  - Table 1.7: Fuel Used in UK Electricity Generation by Volume(Million Tonnes of Oil Equivalent), 2003-2007
  - Overseas
2. Market Size
- The Total Market
  - Table 2.1: UK Generating Plant Capacity for All Generating Companies(Megawatts), 2003-2007
  - Table 2.2: Fuel Mix Used in UK Electricity Generation by Type by Volume (Million Tonnes of Oil Equivalent), 2004-2008
  - Figure 2.1: Fuel Mix Used in UK Electricity Generation by Type by Volume (%), 200815
  - Table 2.3: UK Electricity Net Supply by Type of Producer (Gigawathours),2003-2007
- by Market Sector
  - by Volume
  - Table 2.4: UK Final Electricity Consumption by Sector(Gigawathours), 2003-2007
  - Figure 2.2: UK Final Electricity Consumption (Gigawathours), 2003-2007
  - Table 2.5: UK Final Electricity Consumption
  - in The Industrial Sector (Gigawathours), 2007
  - by Value
  - Table 2.6: UK Electricity Sales by Sector by Value (£m), 2003-2007
  - Figure 2.3: UK Electricity Sales by Value (£m), 2003-2007
- Overseas Trade
  - by Volume
  - Table 2.7: Overseas Trade in Electricity by Volume (Gigawathours), 2005-200721
  - by Value
  - Table 2.8: Overseas Trade in Electricity by Value (£m), 2005-200722
3. Industry Background
- Recent History
- Number of Companies
  - Table 3.1: Number of UK Vat- and/or Paye-Based Enterprises Engaged in The Production, Transmission and Distribution of Electricity by Turnover Sizeband (£000 and Number), 2007 and 2008
- Employment
  - Table 3.2: Number of UK Vat- and/or Paye-Based Enterprises Engaged
  - in The Production, Transmission and Distribution of Electricity by Employment
  - Sizeband, 2007 and 200826
- Regional Variations in The Marketplace
  - Table 3.3: UK Electricity Sales by Sector by Region (Gigawathours), 200627
  - Table 3.4: Number of Electricity Customers in Great Britain
  - by Sector by Region (000), 200628
  - Contents Electricity Industry
- Distribution29
- How Robust Is The Market?
- Legislation30
  - Energy Act 2008
  - Climate Change Act 2008
  - Large Combustion Plant Directive
- Key Trade Associations30
- Afaq-Eta
  - Association of Electricity Producers
- Beamaenergy
  - Energy Networks Association
  - Energy Retail Association
  - Energy & Utility Skills
4. Competitor Analysis
- The Marketplace
  - Generation
  - Transmission
  - Distribution
  - Supply
- Market Leaders
  - British Energy Group Plc
  - Centrica Plc
  - Edf Energy Plc
  - E.on UK Plc
  - National Grid Plc
  - Rwe Npower Plc43
  - Scottish Power Ltd
  - Scottish and Southern Energy Plc
  - Viridian Group Ltd
- Other Companies
  - Aes Corporation
  - Bnfl
  - Ce Electric UK
  - Central Networks
  - Drax Power Ltd
  - Electricity North West Ltd
  - International Power Plc
  - United Utilities
  - Western Power Distribution Holdings Ltd
  - Electricity Industry Contents
- outside Suppliers49
  - Generation
  - Transmission and Distribution
  - Supply
  - Other Equipment
5. Strengths, Weaknesses, Opportunities and Threats
- Strengths
- Weaknesses
- Opportunities
- Threats52
6. Buying Behaviour
- Final Electricity Consumption
  - Table 6.1: UK Final Electricity Consumption by Sector
  - (Gigawathours), 2005-2007
  - Industrial Customers
  - Domestic Customers
  - Table 6.2: Domestic Expenditure on Energy by Type of Fuel and Energy (£m),2005-2007
  - Commercial and Public Administration Customers
7. Current Issues
- Replacement Power-Generating Capacity
- Nuclear Power
- Clean Burn and Carbon Capture and Storage58
- Renewables
- Transmission Network Upgrading
- Smart Meters
- Corporate Developments
  - Contents Electricity Industry
8. The Global Market
- World Market
  - Table 8.1: World Net Electricity Consumption and Forecast Consumption by Region
  - by Type of Fuel (Trillion Kilowathours), 2005, 2010, 2015, 2020, 2025 and 2030
- Europe
  - Table 8.2: Maximum Net Electricity Generating Capacity in The Eu-27 by Type
  - (Gigawatts), 2005 and 200663
  - Table 8.3: Total Gross Production Electricity Supply in The Eu-27 by Type
  - (Gigawathours), 2007
  - Table 8.4: Maximum Net Electricity Generating Capacity in The Eu-27 by Country
  - (Gigawatts), 2006
  - Table 8.5: Electricity Demand in The Eu-27 by Country (Terawathours), 2006
9. Forecasts
- Introduction
  - The Economy
  - Population
  - Table 9.1: Forecast UK Resident Population by Sex (000), Miyears 2009-2013gross Domestic Product
  - Table 9.2: Forecast UK Growth in Gross Domestic Product in Real Terms (%),2009-2013inflation
  - Table 9.3: Forecast UK Rate of Inflation (%), 2009-2013unemployment
  - Table 9.4: Forecast Actual Number of Unemployed Persons in The UK (Million),2009-2013
- Forecasts
  - Table 9.5: Projected Fuel Mix Used in UK Electricity Generation (Terawathours),2005, 2010 and 2020
  - Figure 9.1: Projected Fuel Mix Used in UK Electricity Generation (Terawathours),2005, 2010 and 2020
- Future Trends
10. Company Profiles
- British Energy Group Plc
- Centrica Plc
- Edf Energy Plc
- E.on UK Plc
- National Grid Plc
- Electricity Industry Contents
- Rwe Npower Plc84
- Scottish Power Ltd
- Scottish and Southern Energy Plc
11. Further Sources
- Associations
- Publications
- General Sources
- Government Publications
- Other Sources
- Key Note Sources
Key Note Research
The Key Note Range of Reports