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Dutch experience rings alarm bells for UK energy policy

Like Britain, Holland has adopted a policy of shutting down ageing and dirty coal-fired power stations and replacing them with a combination of renewable energy and new gas-fired power stations.  However, like Britain, Holland has to balance these environmental plans against the political imperative of keeping energy bills as low as possible.

These contradictory aims seriously backfired last year according to Dutch News:

“Dutch power stations used a record amount of coal in the past five months, despite government pledges to curb CO2 reductions. The use of coal was almost 33% up on the previous three years and led to a 4% rise in CO2 emissions.”

The rise in coal use occurred despite renewable energy rising to more than 12 percent of Holland’s energy generation.  The rise in coal use was accompanied by a 9 percent fall in gas generation, suggesting that Dutch energy companies prioritised keeping bills low by opting for cheap coal in preference to (relatively) expensive gas.  While the cost of renewables is falling, they have not been deployed rapidly enough to take up the slack.

In Britain, government may have to u-turn on its commitment to close the remaining coal-fired power stations.  Despite the aim of building new gas and nuclear plants to fill the gap left by coal closures, the UK has been unable to secure the capital investment needed to build the new plants.  The unfolding disaster at Hinkley Point in North Somerset is the most obvious example of this, as it becomes clear that the new Hinkley C plant will not be operational in time to fill the gap left by coal (assuming it is built at all).  However, capital formation problems continue to impede the development of the smaller gas plants together with large renewable projects such as the Swansea Bay tidal lagoon.

Add to this the decimation of gas capacity in the North Sea and the impracticality of large-scale land-based fracking, which promises to increase gas price volatility in years to come, and you have a recipe for a desperate return to coal.

When the proverbial hits the fan, and the British government is faced with the choice between keeping the lights on today or protecting the environment for the future of our children, the sad truth is that, like the Dutch before us, Britain will start burning coal again.

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