Increasing electricity imports from the EU threaten British energy security
of supply whether Brexit happens or not.
That is the key conclusion from an expert report published today by the
Thatcher-ite Centre for Policy Studies.
Britain’s energy strategy, as set out by the Government, is to replace its
old coal fired and nuclear power stations with a blend of renewables and
new gas fired power stations.
But the Government is failing to meet this ambition. The 2012 Gas
Generation Strategy estimated that 26 GW of new gas generation would be
needed by 2030. Yet the actual amount of new domestic capacity being
created is falling well short.
Britain has therefore begun – with little public acknowledgment – to import
an increasing amount of electricity from continental Europe. It is now
projected that the UK will receive 67 TWh of power from undersea
interconnectors by 2030, which is a tenfold increase in the projection made
in 2012.
Tony Lodge, Research Fellow at the Centre for Policy Studies and lead
author of the report, said: “At a time when spare electricity generating
margins across Europe are falling, it does not make sense to build an
infrastructure which risks making the UK over-dependent on imports.
“There are significant supply, cost and market distortion implications of
doing this at a time when the Government should be looking to strengthen
energy security and reduce bills. It would make much more sense for the UK
to build up a safe electricity supply surplus from generators in Britain on
a fair and level playing field.”
‘The Hidden Wiring’ by Tony Lodge and Daniel Mahoney – to be published
today – shows why a move towards a greater reliance on imported electricity
could be problematic. Its key conclusions include that:
Interconnector capacity will almost quadruple by 2030, allowing 20% of UK
electricity to be imported from Europe.
Interconnectors can be a useful way of delivering secure and cheap supplies
across Europe, given they can be used to import and export.
But in Britain’s case it is increasingly one-way traffic. In the 12 months
to March 2017, the UK imported 17.22 TWh but only exported 2.78 TWh.
There are concerns about growing reliance on imported electricity from
Europe as surplus supplies there decline. This is particularly the case in
light of the German elections. Germany is already decommissioning its
nuclear plants. If the Greens form part of the governing coalition, as is
likely, they will demand the closure of fossil-fuel plants.
The more reliant Britain becomes on energy imported from Europe, the more
vulnerable we become to disruptions in supply, to sudden price spikes, or a
wider tightening of capacity which pushes up prices. This imported
electricity also has an unfair competitive advantage, as it is not subject
to the GB Carbon Price Floor or transmission charges faced by British
generators.
Indeed, rather than cutting carbon emissions, Britain is to some extent
“offshoring” them – closing down our own coal fired power plants but
continuing to buy energy from Europe which is likely to have come from
plants of the same type
National Grid’s responsibility for managing the grid and transmission lines
gives it a vested interest in building and promoting new interconnectors,
rather than in promoting the creation of adequate domestic capacity.
In response to these conclusions, the report argues that the UK’s energy
policy must prioritise the building of new gas fired power to deliver
energy security. The paper also argues that the Competition and Markets
Authority should investigate the role of interconnectors.
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