Consciousness of Sheep
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One of the ways that you know the UK’s energy system is in jeopardy is when its most grounded and considered newspaper – the Financial Times – begins to sound the alarm:
“The UK is in theory an attractive market, since few developed countries are expanding nuclear generation, and approval from the UK regulator serves as a badge of quality. Nonetheless, ministers need to recognise the reality: without government support, private capital markets will not finance projects with enormous upfront capital costs, huge construction risks and very long-term pay-offs…
“If the government now believes it can meet the UK’s future energy needs by other means, it should explain how it plans to do so. If it is still relying on nuclear expansion to plug the gaps in supply that will open up, it will need to be open to funding it directly.”
Those concerns deepened earlier this month when Theresa May indicated that the government was considering imposing some kind of price cap on energy companies in response to recent price rises. According to Nick Butler:
“Theresa May needs an energy policy adviser. I hasten to add that this is not a job application – but someone is needed to pull together the necessary reforms and to help the UK prime minister avoid self-destructive mistakes such as an attempt to take charge of fixing energy prices.”
According to Butler, the UK government is too distracted by Brexit and Britain’s economic woes to formulate a strategic approach to the looming energy crisis. There is a recognition that all is far from well with the current arrangements, but little political will to take the kind of action that is urgently needed:
“In these circumstances, the obvious response to grumbling about the way things are is to find someone else to blame. Mrs May seems to have been led into the familiar territory of blaming the energy companies.”
The problem is that the imposition of price caps will deter the very investment that is essential if Britain is to develop a new energy infrastructure based around renewables and nuclear to replace the coal and nuclear power plants that are now at the end of their lives:
“Mrs May needs an adviser who can guide through her a complex but essential process of reform, as well as protecting her from the temptation to fall into the trap of “taking control” of something that is broken.”
Here, Butler is being overly-optimistic. Although he is correct to acknowledge that the energy system that we have is broken, it will take more than an energy advisor to fix it. The capacity that the UK needs if it is to keep the lights on in the 2020s needs to be being built right now. Instead, the UK is dithering over renewables, unable to profitably extract shale gas, closing down coal plants, and standing on the sidelines as the nuclear companies it depends upon are going bust.
