Energy policy of the United Kingdom

For energy use in practice, see Energy use and conservation in the United Kingdom

The Energy policy of the United Kingdom is a set of official publications and activities directed at the present and future production, transmission and use of various power technologies within the UK. Historically a country emphasizing its coal, nuclear and off-shore natural gas production, the United Kingdom is in transition to become a net energy importer. Its national policies are articulated in a series of recent documents centering on the 2003 Energy White PaperEnergy White Paper, Department of Trade and Industry of the United Kingdom (2003); moreover, these policies contain statistics on primary energy sources, end uses and plans for future guidance. At the core of the UK policy is adherence to the Kyoto Protocol, including specific goals for timed phase down of carbon dioxide emissions.

An accomplishment of the UK energy policies starting in the 1980s is a marked decrease in energy intensity, the measure of energy consumed per unit of GDP output. Another achievement has been substantial reduction of the population in energy poverty. A third goal attained has been continuing its tradition of energy supply reliability (measured as distribution and delivery on the electric and natural gas grids); in fact, the United Kingdom is second in Europe to the Netherlands in reliability features.

Overview

Under the Conservatives during the 1980s and 1990s, Government policy was one of market liberalisation linked to the privatisation of state controlled energy companies.

As a consequence, Government no longer has the ability to directly control the energy markets. Regulation is now carried out through the Office of Gas and Electricity Markets (OFGEM), while energy policy is largely limited to influencing the operation of the market. Such influence is exerted through taxation (such as North Sea Oil Tax ^*), subsidy (such as the Renewables Obligation), incentives, planning controls, market entry restrictions (for example the costs associated with connecting to the National Grid), the underwriting of liabilities (such as those carried by the Nuclear Decommissioning Authority), grants, and funding for research.

An accomplishment of this liberalisation and privatisation has been a marked decrease in energy intensity, the measure of energy consumed per unit of GDP output. Another achievement has been substantial reduction of the population in energy poverty. A third goal attained has been continuing its tradition of energy supply reliability (measured as distribution and delivery on the electric and natural gas grids); in fact, the United Kingdom is second in Europe to the Netherlands in reliability features.

Primary energy sources

Historically a country emphasizing its coal, nuclear and off-shore natural gas production, the United Kingdom is currently in transition to become a net energy importer.

In the year 2005 the percentage of energy derived from major sources was as follows: natural gas (40), oil (33), coal (17), nuclear (8), renewable (2).

Coal

Coal usage can be expected to decline steadily because of eroding cost advantages and pressure to reduce sulphur and carbon (carbon dioxide) emissions, notwithstanding ongoing subsidy policies designed to retain jobs in the coal mining industry.

The 2002 Energy Review concluded that the option of new investment in clean coal technology (through carbon sequestration) needed to be kept open, and that practical measures should be taken to do this ^*.

Gas

The major expansion of energy supply is planned to be natural gas. While domestic production from the North Sea gas fields continues to diminish, approximately ten billion pounds sterling is being invested (mostly from the private sector) to enhance pipelines and storage of imported natural gas, most of which will derive from Norway. By the year 2021 North Sea oil and natural gas production is predicted to slip 75 percent from 2005 levels to less than one million barrels per day. Oil and coal reserves for all of Europe are among the most tenuous in the developed world. For example Europe's reserves to annual consumption ratio stands at 3.0Ron Nielsen, The little green handbook, Picador, New York (2006) ISBN 0-312-42581-3, perilously low by world standards.

Nuclear Power

Nuclear generation is presently expected to decline with phase-out of older fission plants, so that about half of the nuclear power production will be lost within 10 to 15 years. Some analyses are underway which may delay the decline.

For details of Government policy on nuclear power see Nuclear power in the United Kingdom

Renewables

The UK Government's goal for renewable energy production is to produce ten percent of electricity in the UK by the year 2010. The 2002 Energy Review ^* also recommended that a target of 20% by 2020 should be set, however this has not been adopted.

For Scotland, the Scottish Executive has a target of generating 17% to 18% of electricity from renewables by 2010 rising to 40% by 2020 [http://www.scotland.gov.uk/News/Releases/2003/03/3412.

Energy end usage

See main article Energy use and conservation in the United Kingdom

Year 2005 UK end use energy percentage is approximately: transport (35); space heating (26); industrial (10); water heating (8) and lighting/small electrics (6). There is a steady increase of fuel usage driven by an increasingly affluent and mobile population, so that fuel use increased by ten percent in the decade ending 2000. This trend is expected to be mitigated by increased percentage of hybrid vehicles.

United Kingdom space and hot water heating consume a disproportionate share of end use compared to the USA and more mild southern European or tropical climates. With regard to building and planning issues affecting energy use, the UK has developed guidance documents to promote energy conservation through local councils, especially as set forth in Part L of the Building Regulations (Conservation of Fuel and power)^*. The associated document. Part 2B, addresses commercial uses, and is generally complete as to heating issues; the guidance is lacking on lighting issues, except with guidelines for local switching of lighting controls. In particular there are no standards set forth for illumination levels, and over-illumination is one of the most significant unneeded costs of commercial energy use.

Carbon emissions reduction

Joining over 170 other nations the UK has committed to reduction’‘Carbon Abatement Technology for Fossil Fuels’‘, UK DTI, 2005 of carbon dioxide emissions, with consequent constraints to its energy policy. The UK produces four percent of the world’s greenhouse gases as of 2003, compared to 40 percent by the USA and 20 percent for the rest of Europe. The long term reduction goal for carbon emissions is 50 percent decrease by the year 2050. A scheme of trading for carbon emission credits has been developed in Europe that will allow some of the reduction to arise from economic transactions.

Road transport emissions reduction is being stimulated by the Vehicle Excise Tax, which rewards motorists for choosing more fuel efficient vehicles. In fact, average carbon emissions fell from 192 to 172 grams/mile between 1995 and 2004. Aviation fuel is not regulated under the Kyoto Protocol, so that if the UK is successful in carbon emission reduction, aviation will constitute 25 percent of UK generated greenhouse gases by the year 2030.

The UK government has one project in the planning stage for natural gas fed power generation with carbon capture by seawater. This facility is contemplated at Peterhead, Scotland, a relatively remote exposure to the North Sea.

Renewable energy

Although renewable energy sources have not played a major role in the UK historically, there is potential for significant use of tidal power and wind energy (both on-shore and off-shore) as recognized by formal UK policies, including the Energy White Paper and directives to councils^* in the form of PPS 22. Renewable subsidies have been enacted which will amount to one billion pounds sterling per annum by 2010. In addition, renewables have been exempted from the Climate Change Levy that affects all other energy sources. The established goals for UK renewable sources are ten percent of electricity generation by 2010 and twenty percent by 2020. The amount of renewable generation added in the year 2004 was 250 megawatts and 500 megawatts in 2005. There is also a program established for micro-generation (facilities of less than 100 kilowatts usually situated in a building) as well as a solar voltaic program. By comparison both Germany and Japan have solar voltaic programs much larger than the installed base in the UK. Hydroelectric energy is not a viable option for most of the UK due to terrain and lack of force of rivers. The government has established a goal of five percent of the total transport fuel that must be from renewable sources (e.g. ethanol, biofuel) by the year 2010. This goal may be ambitious, without the necessary infrastructure and paucity of research on appropriate UK crops, but import from France might be a realistic option (based upon the French wine lake).

In 2005 British Sugar announced that it will build the UK's first ethanol biofuel production facility, using British grown sugar beet as the feed stock. The plant in Norfolk will produce 55,000 metric tonnes of ethanol annualy when it is completed in the first quarter of 2007However it has been argued that even using all the UK's set aside land to grow biofuel crops would provide for less than seven percent of the UK's present transport fuel usage[http://www.esru.strath.ac.uk/EandE/Web_sites/02-03/biofuels/quant_bioethanol.htm.

Energy poverty

Reducing occurrence of energy poverty (defined as households paying over ten percent of income for heating costs) is one of the four basic goals of UK energy policy. In the prior decade substantial progress has been made on this goal, but primarily due to government subsidies to the poor rather than through fundamental change of home design or improved energy pricing.. The following national programs have been specifically instrumental in such progress: Winter Fuel Payment, Child Tax Credit and Pension Credit. Some benefits have resulted from the Warm Front Scheme in England, the Central Heating Program in Scotland and the Home Energy Efficiency Scheme in Wales. These latter programs provide economic incentives for physical improvement in insulation, etc.

2006 Energy Review

In November 2005 the Government announced an Energy Review subsequently launched in January 2006, to "review the UK's progress against the medium and long-term Energy White Paper goals and the options for further steps to achieve them" [http://www.gnn.gov.uk/environment/detail.asp?ReleaseID=184911&NewsAreaID=2.

Some critics of nuclear power have suggested that one reason behind the review is to provide justification for the building of new nuclear power plants ^*.

Tony Blair, speaking on June 21, 2006, is quoted as stating that When the energy review is published...., as well as dealing of course with the difficult issue of nuclear power, there will be a very great emphasis on energy efficiency on renewable energy [http://www.epolitix.com/EN/News/200606/82d8b4c6-4b40-4195-b644-aab24102bf86.htm.

Issues not thoroughly addressed by UK policy

Despite some successes and stated goals, there are some issues that are incompletely addressed by UK policy. The principal such items are:

Loss of energy independence. Rather than creating an aggressive plan to lessen the impending loss of energy independence, the UK policy succumbs to that outcome, with resultant risks to future supplies and costs.

Lack of strong national policy on transport fuel efficiency. While the city of London and other local councils have given incentives to hybrid vehicles, the national policy does not provide any real stimulus to highly fuel efficient vehicles. In fact, the government has done so little to inform the public about fuel efficient options that a survey releasedBBC News, Eco-friendly car unveiled, March 28 2006 in March, 2006: "Some of the 1200 people surveyed ... thought ‘hybrid’ meant two cars welded together. Others thought hybrids had to be plugged in at night."

Lack of emphasis of energy conservation by reducing over-illumination, especially in commercial buildings.

References

External links

In the media

June 29, 2006, BBC, Government promises carbon cuts
June 05, 2006, epolitix.com, Alistair Darling: Electricity profits should be linked to efficiency
September 26, 2005, BBC, UK needs yearly climate updates

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