How is the UK going to manage its energy for the future?

What can be done about rising prices?  Should we use more renewable energy, fossil fuels or nuclear technology?  What can be done about climate change?  Read on to find out...

The UK Energy Review was published yesterday, establishing how the UK will tackle carbon emissions, secure our future energy supply and ensure that households and businesses in the UK have adequate supplies of affordable energy, but what does it all mean?

With prices rising recently due to the UK 'supply gap', oil prices going up and reserves of natural gas in the North Sea becoming depleted, energy has well and truly hit the government agenda. 

Tony Blair announced in November 2005 that an energy review was needed to establish what developments need to be made in coming years to ensure the country has enough power to meet its needs, and hits its targets for carbon emissions without energy becoming unaffordable.

Brief Summary

Emission free: But is wind power a viable option?

• That electricity companies provide 20% of energy from renewables - up from the current 15%
• Storing carbon dioxide in old oil fields - the UK is working with Norway to develop this
• New incentives to make homes more energy efficient and to cut energy waste by businesses
• Measures to cut the 7% of electricity currently used by domestic appliances left on standby
• Encouraging smaller scale electricity generators, and combined heat and power plants, to be sited close to where the power is used
• Cut the UK's CO2 emissions by 60% by 2050, with real progress by 2020

Main Summary

The review is summarised in the following 8 sections, click on a title to expand the bullet points:

• Energy needs
  • Climate change must be tackled but the UK also must ensure it has secure energy supplies at affordable prices
  • The government will publish a white paper around the end of the year on energy policy for the next 30 or 40 years
• Nuclear power
  • Decisions on replacing Britain's nuclear power stations need to be made in the next few years
  • If nothing is done, the share of electricity generated by nuclear will fall from just under 20% now to 6% in 15 years' time
  • "New nuclear power stations would make a significant contribution to meeting our energy policy goals," says the review - if existing capacity is replaced carbon emissions would be lower by the equivalent of two gas-fired power stations
  • The Health and Safety Executive will develop guidance for potential promoters of new nuclear power plants by early next year
  • The private sector will have to fund, build and operate nuclear plants and cover decommissioning costs
  • Safety and security will be "paramount" for building new nuclear plants
  • The planning rules for nuclear and other new energy plants needs to be overhauled
• Saving energy
  • Cutting the amount of carbon-polluting electricity generators will not be enough to meet the UK's target of reducing carbon dioxide emissions by 2050 - energy must be saved, too
  • Consumers need better information about the amount of energy used, "smart metering", clearer energy bills and more information on home energy efficiency
  • The government will work with industry on making domestic appliances more efficient and phase out wasteful goods - saying 7% of all electricity is used by appliances left on standby
  • Government-owned properties should be carbon neutral by 2012
  • Ministers will encourage people to make their homes energy efficient
  • Energy suppliers must get incentives to make households more energy efficient, such as selling more insulation
• Emissions trading
  • The government is planning an emissions trading scheme for the 5,000 large British businesses and public services not covered by the European trading scheme
  • There must be higher prices for carbon polluting generators
• Transport
  • Fuel efficiency is improving. The use of lower carbon fuels, especially biofuels, will be encouraged
  • There will be most cost effective opportunities to save carbon as new technologies are developed
  • The target for the amount of transport fuel coming from renewable sources could be raised from 5% to 10% by 2015
• Cleaner energy
  • More must be done to encourage smaller scale electricity generators - and combined heat and power plants - sited close to where the power is used
  • Low carbon alternatives such as bio mass, solar power and heat pumps will be encouraged
• Renewables
  • Electricity companies will have to provide 20% of energy from renewables - up from the current 15%
  • There will be consultations on banding the rules on renewables to encourage the growth of off shore wind power and tidal plants
• Fossil fuels
  • Coal fired power still meets a third of electricity demand but its heavy carbon emissions must be tackled
  • Carbon capture and storage could cut emissions by 80-90% from fossil fuels
  • Carbon dioxide can be stored in old oil fields - the UK is working with Norway to develop this and plans will be in the pre-Budget report
  • Carbon capture could lead to saving several millions tonnes of carbon by 2020
  • Steps must be taken to secure gas supplies

The executive summary of the review can be downloaded here, courtesy of the BBC.

Nuclear on the Agenda

Industry secretary Alistair Darling told MPs nuclear power needed to be part of the mix of energy supply for the UK over the next 40 years.

The Conservatives say nuclear power should only be a "last resort". The Liberal Democrats accuse ministers of "surrendering" to the nuclear lobby.

Tony Blair says new nuclear power stations will reduce future reliance on imports and help tackle climate change.

In a Commons statement on the Energy Review, Mr Darling said: "The government has concluded that new nuclear power stations could make a significant contribution to meeting our energy policy goals.

"Safety and security" would be "paramount" with nuclear plants, he promised.

"Nuclear does mean we can generate electricity without carbon emissions. It does provide a consistency of energy which wind power cannot," he said.

Mr Darling stressed that "a mix of energy supply is essential and we should not be over dependent on one source".

The plans would help meet the government's target of cutting carbon emissions by 60% by 2050, he said.

And they would ensure the UK had secure energy supplies rather than relying increasingly on foreign gas imports.

Business welcomes nuclear plans but has reservations

The Confederation of British Industry (CBI) said plans to include nuclear energy sources had been "correct".

More nuclear power stations could be on the way

Meanwhile, the Engineering Employers Federation (EEF) applauded the government for its balanced strategy and for "grasping the nuclear nettle".

"Ministers are correct to include both nuclear and renewable power in their thinking," CBI chief Richard Lambert said.

"Streamlining the planning process for new power infrastructure and establishing a long-term pricing mechanism for carbon will help give business confidence to invest in both.

"A level playing field for all forms of energy provision will allow the market to deliver more secure, cleaner and affordable electricity.

However, some quarters did warn that the Energy Review's proposals failed to go far enough.

British Energy chief executive Bill Coley added that the announcement had put to rest some concerns over the planning process for the industry, but did add that the proposals did not go far enough.

"I think what you have to have is further definition of how the process is going to work - a better planning process that gives certainty."

While welcoming the plans, the EEF warned that urgent action is needed now to develop storage facilities in the UK.

Research from the National Grid released ahead of the review showed gas supplies could be even tighter this winter as import facilities remain unfinished and information on supply and demand from the continent remain unclear.

Last winter, household bills soared as suppliers brought in inflation busting tariff increases in the face of surging wholesale prices.

The EEF also urged the government to deal with the UK's "woeful" levels of research and development investment, which remain lower than levels in the US and all but one member of the European Union.

Efficiency call

Meanwhile, British Gas said the government should concentrate its efforts on promoting energy efficiency, adding that nine million homes are wasting £1 in every £3 of their energy usage.

"The challenge is to prompt these householders to take action," British Gas managing director Mark Clare said.

"British Gas has proved that financial incentives work ... yet the Government has failed to grasp this opportunity to put forward some seriously eye-catching incentives - such as stamp duty rebates."

The Royal Institute of Chartered Surveyors (RICS) added that the plans were a "failed opportunity" to challenge the fundamental issues of sustainability and how we all live and work.

Sources: http://news.bbc.co.uk

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