Welcome to Grid Brief! Here’s what we’re looking at today: UK PM Rishi Sunak says that the country needs new gas plants to bolster power supply, a uranium processing facility in the US just shipped its first yellowcake in over a decade, and more.

UK Needs Gas Plants for Reliability

The UK government has changed its mind: it needs new gas plants. Its current fleet is aging and renewable energy cannot power its grid reliably.

“We expect that a limited amount of new gas capacity will be required in the immediate term to ensure a secure and reliable system that avoids blackouts,” the UK government said.

“The announcement comes as part of the second consultation on the Review of Electricity Market Arrangements, published Tuesday. The process closes on May 7 with implementation from 2025, potentially after a change in government,” reports Bloomberg. “The government will broaden existing laws that require new gas plants to be built net zero-ready or able to convert to hydrogen, according to a statement. The stations will be eligible to compete in the government’s capacity auction. This year, a record price of £65 per kilowatt per year wasn’t enough to bring forward any large gas plants.”

"It is the insurance policy Britain needs to protect our energy security, while we deliver our net zero transition," said PM Rishi Sunak, who has previously promised to slow down the country’s energy transition.

Committing to new gas plants means backsliding on national climate commitments for a clean grid in the 2030s. Labour Party members and environmentalists were critical of the announcement.

Re-Opened Uranium Processor Ships First Yellowcake

enCore Energy Corp.’s recently restarted uranium processing plant just shipped its first batch of uranium in 16 years, with more in store.

What’s driving the growth?

“Interest in the resurgence of nuclear energy is way up, and the uranium market has noticed. Uranium prices are up ~86% YoY and are currently sitting at ~$95/pound after trending up for more than five years from local lows in the mid-2010s,” reports Ignition. ”enCore isn’t alone in taking advantage of soaring prices. Uranium producers across the supply chain are racing to increase production and meet the growing demands of the nuclear industry.”

According to a press release from enCore, another contract with an American utility for uranium has grown to to 4.25 million lbs. through 2032, “which is well under 50% of enCore's planned production.”

enCore also plans to restart its Alta Mesa plant by the end of the year.

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Conversation Starters

• Mild, windy weather spares Europe. “With only a few more weeks left in the heating season, Europe is on course to end the winter with a record amount of gas in storage, sending prices sliding and dispelling fears about energy security. But before policymakers congratulate themselves on successfully managing the crisis caused by Russia’s invasion of Ukraine, they should recognise they have been exceptionally lucky with the weather,” reports Reuters. “Back-to-back mild winters in 2022/23 and again in 2023/24 have reduced heating demand for both gas and electricity and allowed the region to amass record gas inventories. The most recent winter has been predominantly mild, wet and windy across Northwest Europe, slashing heating demand while causing a surge in wind farm generation, a double saving on gas.”

• Fire warnings sound across the American West. “Red flag fire warnings are up across the Texas Panhandle, as well as parts of New Mexico, Oklahoma and Kansas, the National Weather Service said. While critical fire conditions exist in a wide swath of that area, the region around Amarillo, Texas and a small part of Oklahoma are facing an extreme situation, the highest category, the US Storm Prediction Center said,” reports Bloomberg. “Dry winds will sweep the area from late morning to early in the evening Wednesday and any fires that start can spread rapidly, the weather service said.”

• US solar wafer manufacturing founders. “Earlier this month, solar manufacturer CubicPV ditched its plan to build a 10 GW U.S. silicon wafer factory, blaming a collapse in global product prices and rising construction costs,” reports Reuters. “China produces around 98% of the world's solar wafers and a ramp up of Chinese solar manufacturing has lowered global prices. Meanwhile, U.S. construction prices have surged since the Covid pandemic due to rising material and labour costs.”

Crom’s Blessing

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