Operations were cancelled as hospitals plunged into darkness… people got stuck in lifts, panicking as they waited hours to be rescued… traffic lights failed causing chaos on city centre roads.

We are not talking about some far-away developing nation stumbling into the 21st Century. Embarrassingly, this was actually the UK… and it happened yesterday.

Cleveland, Cheshire, Lincolnshire and parts of London were left in the dark as a mysterious outage crippled the network. This was no minor local event – and no-one who knows what went on is prepared to speak about it.

The cuts escalated as the day progressed and the National Grid was forced to issue its second-most serious warning: demand control imminent!

Two entirely unrelated power stations (one coal, one nuclear – one in Suffolk, one in Fife) suddenly shut down within minutes of each another… the cascade continued with nine “generating units” also going dark… four other power stations also suffered failures to varying extents.

This caused the price of wholesale electricity prices to jump 35% to £95 per megawatt.

Secrets fill me with rancour…

Mysteriously, both British Energy and E.On said that they could not reveal the source of the problem. They won’t even say when the power stations are expected to be fully back on line, because of the effect this will have the wholesale electricity market.

David Hunter an analyst at independent energy consultancy McKinnon & Clarke summed it up nicely. He told The Times:

“The Government’s inability to make long-term energy security decisions over the last decade is coming home to roost. Since the ‘dash for gas’ in the 1990s, the lack of political will to make tough decisions has left Britain short of power.”

So, there is a massive question mark over the future of the UK. Tony Blair is responsible for this… and so is Greenpeace.

Blair didn’t have the balls to make essential decisions that would have secured our energy future. He was too busy fighting someone else’s oil war. He did not have the guts to take on the greens – and this was a mistake.

He should have set us on the track to nuclear power a decade ago – and made sure everyone knew that coal would have to fill the gap.

Instead he dithered and fretted over what to do. Policymakers even listened to the type of people that love to be in “focus groups,” so men with beards and women in comfortable shoes had their say. There was delay after delay after delay.

Greenpeace made everything worse…

When the government actually did something about getting our nuclear strategy on track, it got it so utterly wrong that Greenpeace took it to court on a technicality! This caused another year-long delay.

We must all consider the following pertinent facts.

Our North Sea oil is running out and oil imports are becoming more and more expensive. Russia is sewing up the European gas market (and we do not want to beholden to the Putins of this world for our future energy security).

Biofuels are an expensive con and burning food is stupid. Wind and solar power are unlikely to be able to provide all the energy for the 75 million people that are expected to be living in this country by the middle of the century.

The solution is blindingly obvious. We need to build new nuclear powers stations – and accept we will have to burn coal in the interim.

If we don’t do this, we could easily find ourselves suffering from energy poverty in the future. We will then have to hand over all our wealth to Russia in order to buy their gas.

Energy poverty will lead to economic poverty and then personal poverty if we let it… and the blame for this can be laid firmly at the door of Tony Blair and Greenpeace.

I worry yesterday’s blackouts could be a mere taster of what we have in store in the future. I reckon you should be worried too.

Regards,

Garry White
Editor
Smart Commodities UK

P.S: If you like what I’ve got to say, you can become a subscriber to my Smart Commodities email and enjoy all the benefits of my regular readers…

Source: Panic, Pestilence and a Nation In Crisis: Welcome to Blackout Britain

You should be glad you do not live in Juneau, Alaska. And if by a 1 in a 100,000 chance you do live in Juneau, turn off your computer. You are wasting precious electricity.

While it is not making any mainstream headlines today, Alaska’s capital is in a state of emergency. A series of major avalanches has taken out the lines that connect Juneau to the hydroelectric source that creates its power.

With nearly two miles of lines down, and no safe access routes for up to a month, the city is in big trouble. It has been forced to switch to huge diesel backup generators. They will be running full power for at least three months until the lines are repaired.

The freak incident will cause huge amounts of financial hardship in the area. As you can probably figure, diesel generators are a bit more expensive to operate than a dam. Juneau’s generators are burning about 100,000 gallons of diesel a day. And with diesel already going for a premium (remember there are no roads into the town to deliver fuel), the city’s fuel bill from this incident will be over $400,000 per day.

You want how much?!

Thanks to the rare ability for the city’s power provider to almost immediately raise its rates, Juneau’s citizens will be forced to pay about four times the normal amount when their next bill arrives. Prices are expected to soar from eleven cents per kilowatt to fifty cents or more. The fallout will not be pretty for this tiny town.

I know what you are thinking, “Boy, that stinks for them. Good thing it can never happen where I live.”

You are probably right. For those of us who live “on the grid,” a major, long-term blackout is highly unlikely, but this is another great reminder of how energy dependent this nation is. We are hooked on the stuff and no form of intervention is going to get this monkey of our back.

The only thing left to do is invest in the stuff and at least profit from the dangerous addiction. For decades, smart investors have been turning towards the nation’s utilities when the economy gets shaky. They make good, safe investments that often pay a hefty dividend.

Even though some may say we have reached the bottom of this economic downturn, I think the worst is yet to come. That means, as Jim Cramer loves to yell… buy, buy, buy.

Keep the juices flowing

Electric utilities are a great option right now. The market is finally being opened to competition, legislatures are allowing power producers to raise their rates, and the nation continues to expand its energy consumption.

Some of the best utilities to look at are the ones working in non-regulated markets, or the ones smart enough to working with wind, solar, or other forms of alternative energy. If a Democrat somehow steals his (or her, of course) way into the Oval Office, alternative energy is going to be a fantastic investment.

One company worth taking a look at is Exelon Corp. (EXC:NYSE). Its share price has nearly quadrupled in the past five years, and it pays 2.4% dividend.

There are dozens of similar mega-producers out there just like one. Start your research with the company that sells you your electricity and work out from there. Almost all of them are a wise investment, especially if the economy weakens any further.

The cost of nearly everything is on the rise in this country. Investing in the nation’s utilities is a great way to get some of that money working for you again.