Our irresponsible government has condemned Britain to a decade of crippling energy crises
Energy suppliers are collapsing. Gas prices are skyrocketing. Invoices will follow soon. And I have bad news for you. We are only at the beginning of the great British energy crisis.
In a way, we’ve been incredibly lucky to get to this point. Price spikes, potential breakdowns and the ensuing chaos have been going on for decades. Fifteen years ago, an expert by the name of Dieter Helm warned MPs about what to expect “just before the lights go out”. We must pay attention to “volatility and sharp price increases”. Seems familiar?
That it be so is a political failure of the most scandalous magnitude that I wish I could say it was unbelievable. But this is not the case. It’s about as incredible as an oil tanker heading towards us at a speed known for two decades. Our politicians did not have to guess or speculate on what would happen. All they had to do was take steps to avoid it. They did not do it.
It is popular in this debate to blame the left and its “green c – p”, as David Cameron did. But let’s not let the current lot go down so easily. When Labor left office in 2010, they left most things in a terrible mess. One area where they left a plan, however, was energy policy.
The plan was ambitious, yes, but at least it existed. The idea was to shut down coal, increase renewable energy and, to cope with the unreliability of wind and sun, replace coal with a new nuclear. Under the coalition and then the conservative governments, the renewable part of the plan took place. What fell through was nuclear.
At the time, Britain had a small but viable nuclear supply chain. Companies had expressed interest in projects that would be sufficient to replace aging factories and add extra capacity. Eleven sites have been identified for new factories. The first were to start operating in 2018, with the promise that planning and regulatory approvals would be “streamlined” to be delivered. Then there was an election.
Japan’s Fukushima disaster – when a massive earthquake triggered a tsunami that inundated a nuclear power plant built on a coastal fault line – was more an excuse than a reason for what happened next. Under Conservative leadership, the government insisted that all new nuclear power plants should be self-financing, something that had never been done in the history of the industry.
At the same time, nuclear companies would need to build power plants capable of withstanding the direct impact of a 747 and a tsunami simultaneously, in places where even earthquakes strong enough to knock over a cup of tea were practically unknown. A succession of foreign state-owned companies valiantly tried to find the “private” financing that the government demanded. Then, one by one, they gave up.
And so we come to our present situation. Over the next two years, Britain’s last coal-fired power plants and more than half of our aging nuclear fleet will be shut down. Together, this will cut 15% of the country’s electricity production even as the government continues to announce exciting new plans to make all of our cars, buses and trains electric.
Perhaps more renewables could help a little, but since the energy produced by the weather is not consistent, the grid cannot handle much more. To close the gap, as with our declining gas production, we will have to import more and more.
In practice, this means that the UK is now dependent on energy sources which are exempt from all of our green targets and whose price is fully controlled by Vladimir Putin.
It has been eight years since our government concluded a price contract for the construction of a new nuclear power plant. Hinkley C was only viable when the government guaranteed an electricity price almost double the market price at the time. Politicians and commentators have lined up to denounce the deal. Yet here’s a strange fact: In August of this year, UK electricity prices exceeded this price point. They do not fall until Mr. Putin decides to relight the gas.
The irony is that nuclear power doesn’t even have to be that expensive. As we have learned with wind and solar, new technologies are always expensive to begin with. But the experience and the economies of scale are wonderful things. If the government gave up its ahistorical insistence that nuclear power plants depend on “private” funding (which actually means partial foreign funding) and pledged to put in place a cohesive plan for a dozen or so new plants, costs would soon start to fall. This is exactly what has happened in countries that have managed their nuclear programs well, such as South Korea. The first time you build a power plant with a new reactor design is always the most expensive. The sixth time, everyone knows what they are doing.
Unfortunately, even in the best of circumstances, we will not be able to bring nuclear capability back to its peak for another decade. To build it up to what is really needed, it will take even longer. The government is basing its hopes on a series of Rolls-Royce mini-reactors still in development, but the first one will not start operating until 2030. We are facing a decade of crippling energy crises and it is a mess entirely of our own doing.
Unlike most situations, there is a relatively quick fix. We are still sitting on over a decade of gas supply in one form or another. Our shale and the remaining underwater resources are like a gift from a fairy godmother. We could start licensing tomorrow and in a few years gas will flow to bridge the gap until new nuclear power plants can take over.
Such a plan would not even have an environmental disadvantage. If we do not produce our own gas, we will simply import gas from elsewhere or use electricity produced by others, some of which will involve the burning of coal. Yet in an act of almost unprecedented stupidity, we designed our regulations to incite precisely the opposite.
Household gas is registered on the ignoble carbon emissions register. Foreign gas and electricity are literally eco-bleached the moment they pass through large submarine pipes and cables.
This winter, thousands of Britons simply cannot afford to warm up. This can’t just be pinned down on lefties munching on hemp. This is the consequence of an irresponsible Conservative government that wasted a decade in power by failing to foresee the consequences of its own green policies. He failed to stand up to fundamentalist protesters and opponents of Nimby. He has not shown an iota of administrative prudence or entrepreneurial vision. He failed in his fundamental duty to keep the lights on and the factories running. His ancestors would be ashamed.