Britain’s power generation capacity is dangerously low and the country risks blackouts for the first time in a generation, with experts warning the problem is a consequence of the drive to a low carbon economy.
Figures out this week are expected to show spare capacity in Britain’s electricity generators will be perilously close to zero this winter and could fall even further, leaving Britain without enough power by the winter of 2016-17.
This week, the National Grid will publish its outlook for electricity supply for the coming winter. It is likely to show that, not including renewable sources which suffer if the wind does not blow or the sun does not shine, spare capacity could be just 1.9 per cent of expected demand.
And the construction of two nuclear power plants at Hinkley Point C in Somerset, which EDF boss Vincent de Rivaz said would allow us to cook our Christmas turkeys in 2017, has yet to begin.
National Grid said it was prepared to buy in reserves via interconnectors from Holland and France, along with supply from renewable energy sources, but even then the margin of capacity over demand is expected to be 5.1 per cent for 2015-16.
It said: ‘We have identified the need to have additional tools in place for the next two winters, ensuring we have a cost-effective insurance policy for consumers.’
It is a far cry from the winter of four years ago, when spare capacity was 17 per cent. But it is the winter after this one that worries experts.
‘What happens in the winter of 2016-17?’ asked Peter Atherton, energy analyst and managing director of investment bank Jefferies. ‘By then 5.5 gigawatts will have been taken out of the system with the closure of coal-fired power stations.
Experts say there is no doubt that the effects of Britain’s headlong rush to decarbonise the economy by boosting renewable sources of energy supply while shutting down coal-fired power stations and failing to build gas-powered ones is set to have a serious impact.
Atherton says that it is not a problem shared by Britain’s neighbours – Spain and Italy have far greater surplus capacity than the UK.
A coal-fired power plant at Ironbridge, in Shropshire, run by E.On will close by the end of this year under European Union rules aimed at reducing the number of coal-fired power stations.
A further three coal-fired plants will shut by early April 2016. Eggborough in North Yorkshire, owned by Czech company EPH, Longannet in Fife, run by ScottishPower, and Ferrybridge in West Yorkshire, run by SSE, have been deemed no longer economically viable by their owners. The four produce nearly 7 per cent of the UK’s power generating capacity.
The Government’s tax regime has been blamed by energy firms for the closures. The UK’s carbon price support mechanism charges companies using fossil fuels for every ton of carbon dioxide they produce.
The tax was introduced by Chancellor George Osborne in his Autumn Statement in 2011 and the Government has estimated that it will raise £1billion a year – money that goes straight to the Treasury rather than to fund environmental projects.
Crucially, the tax is in addition to the European Union’s own scheme, which already taxes carbon emissions.
The tax is unique to fossil fuel users in the UK – foreign power producers who supply the UK market do not have to pay it – and it has been blamed in part for forcing the giant steel plant at Redcar on Teesside out of business earlier this month.
It is a theme the leaders of Europe’s biggest energy companies, including Shell and BP, are expected to focus on this week when they will announce their own plans to reduce carbon emissions ahead of the UN conference on climate change in Paris in December.