bringing power to its knees
WORKERS, SEPTEMBER 2003 ISSUE
Drax, Britain's largest coal-fired power station, has been bankrupt for over 12 months with debts of over £1.3 billion. It has been brought to its knees by a combination of factors, including the insolvency of its previous owners, TXU Power, the uncertainty caused by bids and counterbids, and EU-driven government energy policy.
Goldman Sachs, the US-based banking firm, is bidding for Drax. Banks, both British and international, now own 40% of the electricity generating industry. BHP Bilton, the third largest mining company in the world, is putting in a counter-bid. BHP Bilton intends to ship over 22 million tonnes of low-cost coal from Colombia to fuel Drax, while the power station itself sits on top of the Selby coalfield, which is due to close next year with the loss of 2,000 miners' jobs.
Bilton's plan could sound the death knell for British coal. UK Coal, Britain's only deep-mine coal producer, is currently seeking a subsidy from the government of £79 million to preserve the future of 4,000 miners. UK Coal mined just under 11 million tonnes of coal last year. Its open-cast pits have reserves of over 100 million tonnes.
In the past, before privatisation, Britain led the way in mining and producing coal in a clean and environmental way. Clean coal technology is expensive in the short-term due to the investment needed in plant and skills, but it is cheap in the long run. With such an investment some of Britain's coal reserves of over 1,000 million tonnes could be mined to fuel power stations such as Drax in the future.
· The trustees of the combined miners' pension scheme, which is worth nearly £20 billion, have indicated a possible shortfall in funds of £559 million. Since the privatisation of the pits governments have 'top-sliced' any pension surplus - and since 1997 alone this government has taken over £1.3 million.
This scam is a backdoor method of clawing workers' wages back, based on the 'guesstimates' made by actuaries of probabilities and life-expectancy. Any money handed back is simply money the government has already pinched.