Energy could be the issue that loses Labour the next election in the UK. I thought that might come to a head in about 2028 because the plan to get to 95% green power by 2030 is flawed and almost impossible to achieve, and the costs associated will make UK electricity even more expensive than it is already. If I am correct, those problems will be evident by 2028. But it may be we get to a crunch point before then.
We don’t get a lot of power from solar when the days are short, obviously, and wind power needs… wind. This winter the UK has had some storms but interspersed with quite long periods of calm conditions. When it is cold as well, and demand increases, that means a greater need for gas powered electricity generation in the country. The Times reported the situation like this.
‘The crux of the issue, as Baroness Brown of Cambridge, head of the House of Lords science and technology committee, framed it the next day, is the robustness of our plans for “the doldrums of winter when the sun doesn’t shine and the wind doesn’t blow.” The Germans have a name for such days, she said: dunkelflaute.
Biomass and nuclear provide a steady 20% or so of the requirement, but at times of limited wind contribution, gas takes the strain now that the last coal-fired power station has been closed down. Last week we came closer to power cuts than we have for some time in the UK, and the demand for electricity got perilously close to the maximum that could be supplied.
NESO – the National Energy System Operator - says we weren’t really close to a blackout because ass a standard precaution, the grid works on the basis that we should be able to cope with our largest single source of electricity dropping out, in this case 1.4GW coming on a cable from Norway. This contingency was never breached, and came on top of the standard 0.5GW excess, NESO claims. However, a “capacity market notice”, a special appeal to power companies for additional supply was issued.
That led to two firms being paid millions of pounds to switch on some additional capacity for a few hours of supply, at prices as much as 50 times the usual. Rye House gas plant in Hertfordshire is reported to have made over £6 million for three hours of supply. So you have to wonder why we paid so much if there wasn’t really any risk of system failure?
A linked issue is stocks of gas in the UK. Centrica, owner of British Gas and the largest domestic gas supplier, said they have less than one week’s supply of gas in storage. But again, there were others ready to deny there is a problem, National Gas, which owns the UK gas network, said the UK gets its gas from "a diverse range of sources" and that storage "remains healthy".
Luckily, the weather has warmed up so disaster is probably averted for now. What is clear though is that the UK is now heavily dependent on importing gas from Europe when the wind doesn’t blow. That makes the country vulnerable to price hikes as well as potential supply shortages that could arise through situations totally outside our control.
And it is worth noting that more supply of wind power will not necessarily solve this problem. 1000 turbines not moving does not provide any more power than 100 not moving! Having a range of locations for wind generation spreads that risk somewhat, but this is also the reason why additional wind and solar generating capacity gets more and more expensive in effect as we build more. Some turbines won’t be needed when it is windy, so the cost-effectiveness of each marginal addition to capacity decreases.
What should we take away from this? Well, more nuclear capacity would be great but that’s not a short-term fix and constructing new plants appears to be eye-wateringly expensive. Better storage facilities would help too, particularly to hold energy in the windy times and put electricity back when it’s calm. Also not easy technically, unfortunately. This all adds up to the UK failing to hit the 2030 net zero target OR accepting power cuts as a regular feature of the system.
On a personal level, I’d suggest you should know where the torches, candles, matches, battery-powered radio and firewood are. And from a business point of view, ‘power cuts’ needs to go on the risk register, if it isn’t already.