Profits from using coal to generate U.K electricity for next winter soared to the highest level in 17 months, on speculation natural gas will be diverted to Japan amid the Asian country’s deepening nuclear crisis.
Profit from using coal to generate power in the U.K. for next winter, the six months from October, rose 7 percent to 14.67 pounds ($23.56) a megawatt-hour in London. That’s the highest level since at least October 2009, when Bloomberg started compiling the data.
The profit, known as a clean dark spread, soared as electricity tracked natural gas, making it more favorable to burn coal in power stations. Gas rose on speculation it would be used to replace nuclear generation. Germany said it would close seven of its oldest reactors while it reviewed safety after an earthquake hit Japan, shutting down the country’s nuclear stations and causing explosions at the Fukushima Daiichi plant.
Britain gets about 80 percent of its power from a mixture of coal and gas plants, switching between the fuels depending on prices. The nation also has 10 atomic stations, mostly owned by Electricite de France SA. Mike Weightman, Britain’s chief nuclear inspector was asked by Chris Huhne, energy minister, to report on the implications of Japan’s nuclear situation, according to a statement on the Department of energy and climate change’s website.