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Britain’s efforts to develop clean ways of burning coal face an insecure
future, despite the government’s reprieve for part of the country’s coal
industry.

The trade secretary, Michael Heseltine, last week announced plans to
spend an extra £12 million over the next three years on the Coal
Research Establishment at Cheltenham. The announcement appeared in the White
Paper on the coal industry prepared in response to a parliamentary rebellion
last year over plans by British Coal to close more than half of its pits.

Heseltine’s announcement lifts the immediate uncertainty over the fate
of the CRE, which relies on British Coal for about one third of its annual
budget of £18 million. But the White Paper leaves question marks
over the establishment’s longer-term future, and over its most promising
project, the topping cycle. This involves partially turning coal into hot
gas to drive gas turbines, and burning the remaining char in a fluidised
bed. The White Paper says that the CRE should become an independent research
organisation, and that private industry should take over the topping cycle
project.

Steve Dawes, head of market support and development at the CRE, says
that the announcement was all he had hoped for: ‘It gives us the opportunity
to develop the programme and increase our commercial work to ensure our
future.’ However, he says the CRE would need to reduce its staff as it
moves towards privatisation.

Britain’s programme of research on reducing emissions from coal is tiny
compared with almost $600 million that the US spends each year on developing
technologies such as coal gasification and fuel cells. Heseltine, speaking
at a press conference, defended the difference in scale: ‘Britain cannot,
with an economy of our size, support technological frontiers in every direction.
You have to make judgments. If the Americans are spending at that rate,
why not see if we can share in the technological development that they are
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Heseltine described the White Paper as a ‘wide-ranging review . . .
in the context of the government’s energy policy’. It proposes measures
to reprieve 12 out of 31 coal mines originally named for closure last October,
and to keep another six on ‘care and maintenance’ in case demand for coal
picks up. The extra package of support will cost up to £700 million.

However, the review offers no move away from the energy policy that
precipitated the coal crisis, which allows private electricity companies
to generate vast amounts of power from gas-fired stations, greatly reducing
demand for coal. It also sees no prospect of a market for coal to replace
power generation, which in 1992 consumed 79 per cent of the coal mined
in Britain.

The White Paper also dashes the hopes of both the coal lobby and environmental
groups that the government might take the opportunity to shut down the first
generation of nuclear power stations, the Magnox reactors built in the 1960s.
Heseltine said that, because the government would have to pay to dismantle
them whatever happened, the actual cost of the electricity they generate
is the lowest in Britain. ‘The benefits should not be denied to British
industry and other consumers.’ Friends of the Earth condemned the decision,
describing the White Paper as ‘almost entirely free of policy insight or
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Simon Roberts, FOE’s senior energy campaigner, said the only ‘glimmer
of light’ in the review was a decision to increase by 50 per cent the target
for renewable energy’s contribution to generating electricity in Britain.
This is now 1500 megawatts of new generating capacity by the year 2000.

Although Heseltine said that the free market would continue to guide
Britain’s energy policy, he made one concession to calls for a more strategic
role. A new ‘energy advisory panel’ of independent experts will assist the
government in preparing an annual energy report. The Department of Trade
and Industry could not say who would sit on the panel or what its exact
role would be.