UK Energy Security Strategy deemed ‘a missed opportunity’

THE UK Government has released its much-delayed Energy Security Strategy, which improves long-term plans for more oil and gas, hydrogen, nuclear, and offshore wind. However, the strategy has received strong criticism for failing to deliver on solar power, onshore wind, energy efficiency, and demand reduction.

The strategy, which was due to be published almost a month ago, is a response to Russia’s invasion of Ukraine. On top of the humanitarian impacts, the war has caused energy prices to increase substantially, forcing countries reliant on Russian fossil fuels and other commodities to look for alternatives. The Energy Security Strategy is supposed to improve the UK’s domestic energy security; however most measures announced in it are long-term, with Business Secretary Kwasi Kwarteng admitting that it could take up to five years before the strategy starts to bring down energy bills.

The strategy gives an ambition for 95% of electricity to be low-carbon by 2030, and completely decarbonised by 2035. It will do this through increasing hydrogen production, allowing new oil and gas licences, increasing the level of offshore wind, and building more large nuclear facilities. This year it also plans to run an investment accelerator competition for heat pumps, worth up to £30m (US$39m).

It admits that “the first step is to improve energy efficiency, reducing the amount of energy that households and businesses need.” Despite having a section on efficiency and mentioning the importance of insulation to reduce energy demand, it doesn’t offer any support for this.

Mike Thompson, Director of Analysis at the Climate Change Committee (CCC), said: “For perhaps the first time, the Government has made commitments that clearly go beyond CCC proposals in key low-carbon technologies: offshore wind, nuclear, hydrogen. The new commitments are hugely ambitious – they would see the UK produce more electricity from offshore wind in 2030 than it has produced from gas in any year in history. Government, business and industry will need to focus relentlessly on delivery at a scale and pace as yet unseen.

“Recognising the difficulties in implementing effective policy quickly, it is still disappointing not to see more on energy efficiency and on supporting households to make changes that can cut their energy bills now. Government has reiterated its commitment to do more and we look forward to seeing details in the coming months.”

He added on Twitter that the strategy also fails to account for climate change risks and the need for adaptation.

New oil and gas licences

On moving away from Russian coal and oil, the strategy said that the UK aims to do this by the end of this year, and stop Russian LNG imports “as soon as possible thereafter”. It says that the UK is “building international support to reduce Russian energy revenues” and that internationally coordinated action through, for example, the International Energy Agency (IEA) is key to support stable markets. However, it has not attempted to incorporate all of the measures suggested in the IEA’s ten-point plan for reducing European reliance on Russian gas this year, which includes  “accelerating energy efficiency improvements in buildings and industry” and “enacting short-term measures to shelter vulnerable electricity consumers from high prices”.

The strategy said that there is an estimated 7.9bn bbl of oil reserves and 560bn m³ of gas in the North Sea, and that the Government would send clear signals on the role of oil and gas in the energy transition by enabling the North Sea Transition Authority to launch a new licensing round this year.

The announcement is in contrast to the IEA’s warning that no new oil and gas development can take place if the world is to keep to the target of no more than 1.5^oC of warming. It also fails to take into account the caution from the CCC that a new licensing round would not lead to new production until the 2030s or 2040s, at which point UK oil and gas consumption should be much lower. It also doesn’t take into account the warning in this week’s IPCC report, which said the current and planned fossil fuel infrastructure alone would release more CO2 emissions than is left in the global carbon budget. The IPCC said that there needs to be a “significant reduction” in fossil fuels and that fossil fuel infrastructure and resources are likely to become stranded assets, with countries with large oil and gas reserves most at risk.

Deirdre Michie, Chief Executive of OEUK, said: “The UK has enough proven oil and gas reserves to support the UK for at least 15 years, but we need regulatory approval to invest in the platforms, pipelines and other infrastructure needed to access it. The announcement of a new licensing round and the proposal to cut the time needed to get those approvals, by the introduction of regulatory accelerators, will help our industry carry on providing the UK with the energy it needs.”

The Government also said that it would remain “open-minded about our onshore reserves”. It has commissioned a survey by the British Geological Society to determine if there are “any further scientific updates on seismicity that the Government ought to consider” in relation to fracking. The UK’s only onshore shale gas exploration wells were recently ordered to be plugged, although this decision was overturned last week. This is despite the fact that the Government previously admitted that fracking would produce insufficient supplies to address the high cost of gas.

Ged Barlow, Chief Executive of Net Zero North West: “Today’s strategy recognises the role that natural gas will continue to play and that producing it in the UK has a lower carbon footprint than [that] imported from abroad. It is an important transition fuel and shouldn’t be demonised. Reaching net zero is a journey and we will require carbon capture and blue hydrogen to get us there. This does not mean a step back from net zero. In fact, we suggest that the additional tax income from more UK-produced natural gas could be used to fund the transition to net zero.

“However, gas is very much part of a transition strategy. A net zero future will require a range of low carbon technologies – including renewables, nuclear, hydrogen and ammonia – to provide energy security for the future.”

Eliot Whittington, Director of Policy at the Cambridge Institute for Sustainability Leadership (CISL), said: "Efforts to scale up North Sea oil and gas production are likely to have limited effect on household bills but prolonged impacts on the climate. While diversifying our energy away from Russian gas is welcome, new spending on fossil fuels represents good money going after bad. This is a go-slow strategy in a fast-moving world."

Doubling hydrogen capacity

The Government aims to double its ambition for low-carbon hydrogen production to 10 GW by 2030, with at least half coming from hydrogen which is produced via electrolysis, which will utilise offshore wind power.

It aims to have annual allocation rounds for electrolytic hydrogen to get the price to become more competitive, with the goal to have 1 GW by 2025. It plans to design new business models for hydrogen transport and storage infrastructure by 2025.

Nilay Shah FIChemE, Professor in the Department of Chemical Engineering at Imperial College London, said: “It’s promising to see a doubling of the near-term ambition around hydrogen. We know that hydrogen will be critical for industrial decarbonisation and increasingly as a new chemical feedstock. Most of the increase in the 2030 target is to be supplied by green hydrogen. This will be challenging for the supply chain to deliver, but if done effectively should drive innovation and help to reduce costs.”

A statement from the Chemical Industries Association said: “It is good to see a doubling ambition to up to 10 GW of low carbon hydrogen production capacity by 2030 for which our industry not only plays a key role in delivering; but is a key transition fuel for our sector’s net zero ambition. 

“Over the coming weeks and months we urge Government to consider and work with industry on other measures to help level the playing field against our international competitors, who are now benefitting from increased support.”

Joe Howe, Chair of the North West Hydrogen Alliance, said:  “Accelerating delivery and use of low carbon hydrogen is essential, alongside electrification, to reach net zero. We would argue that the target could go a step further with 15 GW possible by 2030. Something that people often cite with renewables is their intermittent nature. When it comes to hydrogen in the North West, we’ve the ability to deliver affordable storage at a large scale. It means we can reduce the risk of energy supply shortages, reliance on overseas supplies and volatility of energy prices.”

Tom Baxter FIChemE, Visiting Professor of Chemical Engineering at Strathclyde University, said: “When the UK is trying to reduce near-term energy usage, the green and blue hydrogen focus seems wrong-headed. Blue hydrogen requires more fossil gas to produce a kWh of heat or mechanical work and its low carbon status is undermined by supply chain methane emissions. Similarly, green hydrogen will require more green electricity to produce a kWh of heat or mechanical work. Further, the UK’s current grey hydrogen production is a large GHG emitter. Any low carbon hydrogen should be used to firstly displace the UK’s dirty grey hydrogen not used for near-term heat or mechanical work.

“Where this new strategy fits with the UK’s commitment to reduce GHG emissions by around 45% this decade needs further explaining.”

Up to eight new nuclear reactors

The current capacity from nuclear reactors is 6.9 GW, with most of the current facilities due to retire in coming years. The Government now aims to boost this to 24 GW capacity by 2050, which should make up 25% of energy demand. It will do this by approving up to eight new reactors, and aiming to deliver the equivalent of one reactor a year, rather than one a decade.

It is setting up a new Government body called Great British Nuclear to accelerate the pace of new project deployment, and it aims to launch the £120m Future Nuclear Enabling Fund this month. It expects to initiate the selection process for new projects next year, which includes the possibility of a new reactor at the Wylfa site in Wales.

Adrian Bull, BNFL chair in Nuclear Energy Systems at The University of Manchester’s Dalton Nuclear Institute, said: “The step change in pace for delivery of nuclear energy promised by today’s strategy is just the kind of thing we will need to stand a chance of reaching our net zero commitment by 2050. It certainly won’t be easy to deliver anything like one nuclear reactor a year, instead of one a decade, but it’s not impossible.”

Tom Greatrex, Chief Executive of the UK Nuclear Industry Association, added: “We also want to see the money from the promised Future Nuclear Enabling Fund allocated at pace, with good sites being made available for project development.”

An analysis by independent climate change think tank E3G just prior to the release of the strategy warned about the extremely high costs of new nuclear power stations, noting that the CCC and National Infrastructure Commission have said that the UK doesn’t need more than two large new reactors, including Hinkley Point C, which is currently under construction. This is based on keeping net zero affordable.

More offshore wind, but falling behind with other renewables

The current capacity from offshore wind is around 10 GW, and the Government now aims to increase this to 50 GW by 2030, up from a previous target of 40 GW. This includes 5 GW of floating wind turbines. It also plans to halve the current deployment and development time for offshore of around 13 years. This will be done through measures such as reducing the consent time from four years to one, implementing a new Offshore Wind Environmental Improvement Package, and working with the Offshore Wind Acceleration Task Force.

The strategy says that “we need to be bolder in removing the red tape that holds back new clean energy developments and exploit the potential of all renewable technologies.” However it hasn’t done anything to remove the red tape surrounding planning permission for onshore wind. Restrictions on onshore wind were introduced by the Conservative Government in 2015, which is partially responsible for increasing household energy bills, according to analysis from Carbon Brief.

The most stunning and cowardly failure in the strategy concerns onshore wind.

Michael Grubb, Professor of Energy and Climate Change at UCL

Onshore wind is one of the cheapest forms of energy available, and the UK currently has around 12 GW of capacity. It said that onshore wind is included in the latest Contracts for Difference round, however it will not “introduce wholesale changes to current planning regulations for onshore wind”, instead consulting with a “limited number of supportive communities”.

Michael Grubb, Professor of Energy and Climate Change at UCL, said: “The most stunning and cowardly failure in the strategy concerns onshore wind. It is not only our cheapest energy resource – onshore wind would typically cost about a third to a quarter of what people are now paying for their electricity. It is, along with solar, the only one that could make a dent in the short term.”

This is currently 14 GW of solar capacity and costs have fallen 85% over the last ten years. The strategy says that solar capacity could increase five-fold by 2035. The Government will consult on amending planning rules for ground-mounted solar and aims to simplify the planning process for rooftop solar.

Grubb said: “50 GW of solar PV – about four times current levels – was being floated, but doesn’t in the end appear in the strategy. When the Government first introduced incentives for solar, the capacity rocketed from 1 to 10 GW within barely three years, so 50 GW would be possible within a few years. 50 GW PV would supply around 20% of current UK electricity demand.”

‘Wholly inadequate’

In terms of dealing with the current energy crisis alongside the climate crisis, the strategy has received a lot of criticism. Nick Eyre, Director of the Centre for Research into Energy Demand, said that by focusing on expensive and slow supply technologies, the strategy will fail to deliver what is needed. Several people noted that the strategy only deals with supply, and is a “missed opportunity” regarding energy demand and efficiency. Neil Strachan, Director of the UCL Bartlett School of Environment Energy & Resources, said: “This strategy is a missed opportunity on the energy demand side, as any proposed supply side improvements to energy security will only be realised in 10 to 15 years’ time. If the UK wanted to improve energy security right now, as well as generate many jobs and improve health outcomes, it should insulate every home and commercial building in the UK.”

Jon Gluyas, Director of the Durham Energy Institute, called the strategy “an uninspiring mix of more of the same and it fails to properly tackle the UK’s underlying insecure energy supply and does very little to meet the nation’s zero carbon mantra shouted so loudly at COP26.”

Grubb said that the “defining feature of this energy strategy is incoherence”. He added that: “the ultimate irony of a strategy borne of a crisis is that by the time most of its proposals see fruition – if they do – the crisis will be long past.

“We also risk undermining much that the UK has achieved on climate change. By failing to focus centrally on a joined-up strategy to solve these twin crises together, it fails to offer the energy sector the consistent signals that investors need, and may even worsen the short-term bills crisis, whilst our international credibility teeters on a knife-edge.”

Frances O'Grady, General Secretary of the Trades Union Congress (TUC), said: “The strategy promises no new help to preserve jobs in energy-intensive industries, threatened by soaring energy costs. And it fails to invest in zero-carbon steel, electric vehicles, and clean manufacturing. Ministers should be far bolder. Now is the time for a strategy that defends and creates hundreds of thousands of jobs, delivers affordable energy to homes and workplaces and stops climate change.”

Nina Skorupska, Chief Executive of the Association for Renewable Energy and Clean Technology (REA), said: “The Energy Security Strategy is wholly inadequate. If ever there was a time for the Government to be bold, this was it, but they have failed to rise to the challenge facing the country.

“Of course, we welcome commitments on solar, hydrogen and offshore wind, but the Government’s plans will lock the UK into more expensive, longer to build, non-renewable power sources. It ignores a huge swathe of other renewable technologies and the approach to onshore wind is totally inadequate.

“The UK needs to move rapidly to an energy system which is independent, secure and stable – this strategy will simply not achieve that.”