Energy insecurity

A year on from the ‘Powering Up Britain’ strategy, Government policy is pushing the UK backwards on energy security.

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Delays to offshore wind mean UK could miss out on 22 times more homegrown electricity than could be generated by gas from new North Sea licences.

In March 2023, the Government published its Powering-Up Britain strategy, with “plans setting out how the government will enhance our country’s energy security”.

At the time, experts raised concerns about the focus on UK production of fossil fuels that could have only a negligible effect on our energy import dependence, and the limited drive for renewables and energy efficiency that would boost our energy security.

In the year since, the Government seems to have doubled down on this approach.

The Prime Minister made a public speech in September 2023 in which he announced a series of policy changes that will prolong the UK’s dependence on oil and gas.

He announced the scrapping of regulations to improve the energy efficiency of private rental homes, that would have led to 2.4milllion households using less imported gas for heating. He announced the scrapping of plans to replace oil boilers, that would have led to 1million households using no imported oil for heating. And he announced a change in the ICE phase-out that contributed to a projected fall in sales of 2.8 million EVs that would have allowed more drivers avoid imported oil and fuels.

The Government disbanded the energy efficiency taskforce that was advising on cutting energy demand by 15%. It also recently delayed the Clean Heat Market Mechanism (CHMM) that would have accelerated heat pump sales and so reduce gas imports. And administrative misjudgements have slowed the deployment of offshore wind farms, which displace gas power generation and cut gas imports.

The Government also introduced a Bill to require annual licencing that might lead to more oil and gas production, and recently prioritised gas power plants in the Capacity Market at the expense of technologies that would reduce gas imports.

Analysis shows that the reduction in UK-based electricity generation due to delayed offshore wind farms could be 22x larger than the electricity that could be generated as a result of new licences for gas exploration. The UK could suffer a cumulative net loss of about 150TWh of electricity production based on UK offshore wind by 2030, a shortfall that would have to made up partly (and maybe mostly) by generation using imported fuels. Replacing this lost wind generation with gas power would drive up gas imports by 300TWh over six years.

Similarly, by delaying the ICE phase-out, meaning fewer EVs on the roads (running largely off UK-generated electricity), UK drivers could use a cumulative total of 55TWh more energy by 2030, and 65TWh more imported energy.