'Scotland must keep nuclear in mind'

BILL Coley, the head of nuclear operator British Energy, yesterday warned that it would be imprudent for Scotland to turn its back on the possibility of more nuclear power stations but conceded there was currently no need for them.

British Energy, which is headquartered in Livingston and has power stations in Ayrshire and East Lothian, said it expected to outline plans for four new nuclear plants when it announced its full year results later this year. The company has said these will all be in England, where demand for electricity is greatest. The Scottish Government has also said it is opposed to new nuclear power stations being built north of the Border.

While British Energy conceded Scotland, which exports electricity, did not figure in the "first wave" of new stations, Coley warned against writing off the source for the future.

"At some point electricity will be needed," Coley said yesterday. "You have ageing units, some of which will be taken out of service, of all generating types.

"If you want a good example (of what can go wrong], look at South Africa. That country is going through a very stressful time, from a lack of generating capacity.

"Once you're in that position, it takes a long time to recover from it, because you can't build new capacity overnight, and it can have huge consequences for quality of life and the economy."

South Africa, after decades of under- investment in infrastructure and generation, has suffered major power cuts, which have hit its huge mining sector.

Coley added "planning early" was essential. "To take comfort and say we don't need planning for Scotland will not be prudent," he said.

The comments came as British Energy reported a 4 per cent fall in earnings for the nine months to 31 March to 745 million. But the figures were well ahead of many analyst forecasts, and a 14.5p a share special dividend was in line with market expectations. British Energy shares rose 9 per cent to 533p.

Despite output being only marginally ahead of the same period a year earlier at 45.7 terawatthours, Coley was "very pleased" with the operating performance, with only 2.8TWh of unplanned losses. "That's the lowest in the company's history and we've been seeing a tremendous number of metrics for 'best evers' in performance."

Analysts welcomed the figures and progress on new build, but said detail was needed on the plans before value could be attributed to them.

Coley added that he believed British Energy and joint venture partners Amec had "provided all the information we could have provided" to support the application for a 181 turbine wind farm on Lewis. The partners have until Friday formally to respond to a Scottish Government request for further information. Ministers have indicated they are minded to reject the application.