How to Fix UK Energy Policy: Choose the right catastrophe

I heard Professor John Loughhead from BEIS (the part of Government that now looks after energy) speak at the Royal Society event on Decarbonising UK Energy last week. He spoke persuasively about ‘energy security’: planning ahead to avoid shortages of gas, liquid fuels for transport, and electricity black-outs. Loughhead is a good guy who knows his ROCs from his NOx [1], and I usually agree with him. Not this time.

I invited him to join a conspiracy that you might like to join too.

Most people working on climate change agree that we have a wicked problem to solve: we need to reduce global greenhouse gas emissions fast enough to avoid runaway climate change of more than 2C. In the UK, this means cutting emissions by 80% by 2050, continuing to cut them after that, and ultimately achieving negative emissions to begin to reduce greenhouse gas concentrations in the atmosphere.

Most UK emissions come from four sectors: transport, industry, buildings and power. In the past five years we have achieved phenomenal savings (about a quarter) from power, but emissions from other sectors are flat or even rising slightly.

But the power sector is categorically different from the other sectors. Most power generation is centralised and controlled by a small number of closely regulated companies – perhaps a thousand firms, dominated by six familiar names – who operate from a relatively small number of sites that are conspicuous and relatively easy to police. This means that big decisions by a small number of people makes a big difference. Drax Power, for example, decided to switch half its capacity to using biomass instead of coal, and this brought an 86% saving in emissions from 17% of the power supplied to the UK (cutting nearly 15% from power emissions overall).

In contrast, as everyone knows, emissions from buildings, transport and industry rely on decisions by millions of people who are diffuse, often hard to engage about energy and climate change, and even harder to police. There are 27 million households, 18 million drivers [2], and 5 million UK businesses, for example. To make a difference in these sectors requires big decisions by a large number of people. Big decisions (say, switching to an electric vehicle instead of a petrol car, or doing a whole-house retrofit) by a thousand people makes hardly any discernible difference.

Most people working on climate change would also agree that energy prices are too low. This means that most of these households, drivers and businesses have a hundred other things to think about before they even consider energy use or emissions. We all know that raising energy prices would move energy to the front of people’s minds and help them to justify investing (time, energy, effort) in trying to reduce energy use – whether this is something simple like putting on a jumper and turning the thermostat down, or something complex like installing a heat pump.

But raising energy prices is impossible in today’s political climate where energy prices come third – after only health and education – as measuring sticks used to whack politicians. (Even Brexit is probably less important to most people than how much they pay in their next energy bill.)

Equally impossible is the idea of the Government intervening in the market to limit the supply of energy – through rationing or forcing people to use less energy at home, at work or for transport.

Shshsh – keep this quiet

Here’s the conspiracy: we stop talking about energy security. The problem will not go away, and it is only a matter of time before gas from Siberia and elsewhere becomes more scarce (pushing up the price). There is some chance of temporary shortages of gas if political or other problems interrupt the trans-Siberian gas pipeline and/or internationally traded liquified petroleum gas.

If we do not invest heavily in new power generation capacity and grid reinforcement there is every chance of power blackouts and brownouts (voltage drops) – decidedly inconvenient, and potentially fatal for vulnerable people living in poorly insulated homes.

Similarly, if we stop talking about (and planning for) energy security there is every chance of liquid fuel shortages that could see queues at the pumps and people demonstrating in the streets.

At this point (hopefully earlier) the Government would have to step in to keep vulnerable people warm, to ration the remaining energy supplies fairly, and to minimise the impact of shortages on the economy. (This is what we should be talking about and planning for – as well as ensuring the Government doesn’t carry the can for things going wrong: it’s the same unfettered market that has delivered energy prices that are two thirds less, relative to incomes, than they were in 1970. [3])

This would cause a lot of pain. But maybe this is the sort of pain we need before the millions of decision-makers running homes and businesses, and driving cars, begin to understand the need to act.

There is no advertising campaign for electric vehicles as persuasive as a closed petrol station. Interrupted gas supplies during a cold spell would sell more insulation and heat pumps than four decades of energy efficiency proselytising by Government and others. Just watch the growth in sales of renewables and energy storage systems if the energy grids begin to wobble.

Energy shortages, queues at the pumps, rationing and blackouts would be catastrophic. But given a choice between a short-lived, remedial catastrophe and the long-lived, irreversible catastrophe of runaway climate change, I know which I would choose.

 

[1] ROCs are Renewables Obligation Certificates. These record how much power is generated from renewable (low-carbon) sources. NOx are oxides of nitrogen, generated like carbon dioxide by burning fossil fuels. These act as indirect greenhouse gases, although they can also help to counter warming by helping to break down methane emissions.

[2] Department for Transport (2016) Road Use Statistics Great Britain 2016. London: DfT.

[3] J Palmer, I Cooper (2014) The UK Housing Energy Fact File 2013. London: DECC.