BE results up despite outages

27 February 2007

British Energy has published its Q3 results for 2006-07 for the nine months ended 31 December 2006 showing an improvement in financial performance from higher electricity prices, despite reduced output from the company’s nuclear portfolio.

The company reported an operating profit of £626 million ($1.23 billion) on the back of higher electricity prices with an operating margin increased to £14.0/MWh ($27/MWh) for the period from £6.4/MWh ($12.5/MWh) in the comparable period for 2005-06 on the back of a realised price of £40.8/MWh ($80/MWh) for the period, up £11.8/MWh ($23/MWh) or 41%.

However, operating costs increased to £26.8/MWh ($52.5/MWh) for the period, up from £22.6/MWh ($44/MWh) last year, reflecting lower output and as a result of boiler issues at Hinkley Point B and Hunterston B and repairs to cast iron pipework at Hartlepool. This includes an investment increase of £25 million ($49 million) in the financial year 2006/07 as a result of boiler issues.

Total output for the period was 44.0 TWh, down from 48.7 TWh for the comparable period with nuclear output down to 38.9TWh compared with 43.9TWh previously

reflecting nuclear unplanned capability loss factor of 20% for the period, up from 13% for the comparable period.

Total nuclear unplanned losses for the period to 4 February 2007 came in at 16.6 TWh including unplanned losses of 6.1 TWh due to boiler issues. The company has completed all boiler inspections at Hunterston B and Hinkley Point B. Required repair work has been completed at Hinkley Point B and will be completed next month at Hunterston B.

British Energy has also announced that it is launching a process to invite potential partners to submit proposals for new nuclear generation projects in the UK. Potential partners will be asked to indicate the nature and scale of their interest and how they wish to work with British Energy in developing, building and operating new nuclear stations and/or their interest in the electrical output.

BE has said that the selection of any proposals and the start of any work would take place if the new White Paper on energy, now delayed most likely until May, is supportive for new nuclear generation.

Bill Coley, British Energy chief executive said: “Construction of new nuclear power stations is critical to meeting the UK’s security of supply and climate change objectives.”

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