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David Cameron Must Reform DECC & Accelerate Britain’s Shale Development

Andrew Critchlow, The Daily Telegraph

A majority government is an opportunity to fix Britain’s broken energy department. Forget ill-conceived green commitments. The jobs and industrial growth created by shale in the US should be enough motivation to exploit our own resources.

Prime Minister David Cameron looks as a shale oil well

Britain’s energy industry has cause to celebrate the resounding Conservative victory in the general election. Under an ill-conceived, Labour-led coalition government — backed by the Scottish nationalists and Greens — the lights would have been in danger of going out across the land before Christmas.

More than any other sector, energy would have felt the full force of Ed Miliband’s socialist quest to hammer free enterprise by virtually making “profit” a prohibited word in the English language. The now ex-leader of Labour had placed freezing energy prices — in effect choking off private investment — at the top of his party’s agenda without any consideration for the massive shortfall in energy supply that Britain faces.

David Cameron’s choice to lead the Department of Energy and Climate Change (DECC) will now be critical in ensuring a competitive environment for energy utilities to make a fair profit. It will need to make sure investment is encouraged to generate the new electricity capacity that is vital to power the growing economy that will come from another five years of Conservative government.

With spare energy capacity expected to drop to around 4pc again this winter, Britain must urgently build more conventional and nuclear power plants without delay. Forget ill-conceived commitments to generate 15pc of the UK’s power from renewables by the end of the decade by building even more useless windmills and solar parks. The construction of the Hinkley Point nuclear plant and several new gas-fired stations is now vital.

Britain’s spare capacity margins have been tight before. Source: National Grid

As the amount of oil that can be recovered from the North Sea declines, the burden for meeting our energy needs will increasingly fall on securing abundant and reliable sources of fossil fuels from overseas. The lessons of the past six months are that the UK cannot fall into the trap now facing the rest of Europe, which is increasingly beholden to Russia and the mood swings of Vladimir Putin for a large proportion of its gas supplies.

If we are to import more natural gas, this must come from reliable partners such as Norway and Qatar, who we can trust will not hold the nation to ransom for political gain. Onshore, important decisions must also to be taken on how to move forward the development of shale oil and gas resources, which in some cases exist in green belt and natural beauty areas. Although no one wants to see Britain’s countryside turned into Texas, with a “nodding donkey” in the corner of every green field, our economy will wither and die unless we find a way to harness our onshore fossil fuel resources. The jobs and industrial growth created by shale in the US should be enough motivation to exploit our own resources.

Following the departure from energy of Tory minister Michael Fallon to defence last year, the process of encouraging the nascent shale industry in the UK appeared to stall. The danger is that the opportunity to tap this potentially vast resource will be lost unless the energy department and the new Oil and Gas Authority do more to encourage major companies to invest.

Then there is climate change. Policymakers will gather in Paris later this year to hammer out a binding agreement on carbon emissions and limiting global warming. Britain has already made an important contribution to the debate and placed renewables at the centre of energy policy. But the country cannot afford to fall into the trap set by the climate change zealots who would see our great oil and gas companies bankrupted on the evidence of some questionable scientific assumptions.

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