Peter Rolton: Chairman, Rolton Group
Well, the inevitable has happened: ‘Blackout Britain’ has made its way back into the news as the National Grid announces that this winter brings with it the highest risk of power cuts in six years. Not that it’s anything to be smug about, but this news isn’t really new…
There are several blogs in the Rolton Group archive (see here or here) that demonstrate long-standing awareness of the uncomfortable issue that is the energy gap, each spelling out an increased need for the integration of proper, working solutions.
A sizable part of the problem is that energy sourced from Britain’s indigenous coal has sharply declined since last winter in response to EU emission regulations. The increased chance of blackouts makes it clear that measures taken to replace this gap with alternative sources thus far have proven to be too little, too late. Whilst some are content to sit back and blame renewables targets for the current state of affairs, it is the blinkered and short-term thinking of successive governments that has really put us in this bind. Roots of the issue can be dated back to the 1970s, when the government halted its nuclear development in the wake of the Chernobyl disaster and by doing so set the snowball rolling for ever-shrinking capacity headroom.
You have to wonder what the government makes of the effect on economic recovery in all of this, because if worse comes to worst, they will have to prioritise who gets what energy is available, and it isn’t going to be the industrial sector. If supply can’t meet demand, the UK’s largest energy users are at the mercy of their interruptible contracts, which state that the government has the authority to reduce or even shut down their power supply in times of shortage. Consider who these users are: heavy manufacturing industries such as automotive, steel foundries, aerospace, chilled stores, even supermarkets, whose frozen food must be wasted if power remains off for twenty minutes or more. If these operators are forced to slow or stop production, it doesn’t take an expert to see that it spells bad news for the nation’s economic growth.
Potential repercussions don’t stop there, either; many of the global players have taken their production lines from the UK in search of cheaper shores, and those who remain have done so based on principles of heritage and quality among others. If they are no longer able to trust the security of their supply, they have one more reason to up sticks with the others, and that is something we really cannot afford to risk. This is, of course, not to say that industrial users should be put ahead of keeping hospitals, schools and services up and running. The point is that we shouldn’t be in this position of choosing either/or.
UK Government is making the right noises as it pushes forward on electricity market reform (EMR), and Greg Barker MP hit the nail on the head when he stated that ‘the Big Six must become the big 60,000’ in terms of who controls the energy market; the crucial point is that they must make sure funding and planning is streamlines to make the progress necessary. The energy gap needs addressing before it becomes a chasm that destroys British business.
Follow Peter Rolton on Twitter: www.twitter.com/RoltonGroup