ABSTRACT
BE had to cope with an unusual asset base. Seven of its eight power stations were based on the unique British AGR design, and not all of these were alike. This chapter analyses whether that legacy contributed significantly to the company’s financial crisis. Certainly the outage at the Torness station in the summer of 2002 damaged cashflow and investor confidence at a critical time. The fall in output reliability from 1999 undermined the board’s expectations of future profits. But the evidence of the subsequent years is that the company’s own under-investment in the power stations contributed to the poor station performance. It is even arguable that the company was (inadvertently) distributing cash to shareholders that should have been kept for station maintenance.
