The twin goals of UK energy policy should be to ensure security of supply for households and businesses, and to ensure the electricity we use is affordable. Unfortunately, the current UK coalition government is failing on both fronts.
In particular its flagship initiative, Electricity Market Reform, has led to a hiatus in energy investment. This is very bad news for England. In effect we are now seeing a critical reduction in our spare energy capacity, which will eventually see electricity costs spiral out of control. For London this might well mean the lights going out post-2015.
As Scotland exports approximately one quarter of the electricity it generates, this is not such a problem for Edinburgh. In recent years this has been bolstered by a truly world class renewables industry. Scotland now produces nearly the equivalent of 50% of its electricity from renewable energy sources such as onshore wind and hydro. This will increase to around 70% by 2017.
I strongly reject Ed Davey’s announcement that if Scotland votes yes then Scottish electricity bills would increase. This can be seen in a comprehensive report that I published with colleagues from a number of universities from across the United Kingdom in December.
To summarise some very complex arguments, as a result of the coalition government’s decision to fund new nuclear build, we found that a Scottish government committed to no nuclear build would actually see reductions in consumer electricity bills compared to the rest of the United Kingdom. Scottish consumers would not be subsidising the hundreds of billions of pounds of investment that new English nuclear power stations require.
DECC’s big budget drain
Already the Department of Energy and Climate Change (DECC) spends £2.5 billion or 42% of its annual budget on existing nuclear legacy. Of that, £1.6bn is spent on managing the waste at Sellafield alone.
In its misguided aspirations the coalition government is now writing a blank cheque for new nuclear. At a time of unprecedented financial austerity this is somewhat astonishing.
Under no scenario can I see electricity bills in an independent Scotland increasing along the lines outlined by Ed Davey. Even without an integrated electricity market, Scotland would be able to sell its electricity to England at commercial rates. England currently has to resource much of its electricity requirement from Scotland; there is no alternative source for the majority of it. It is pure fantasy on the part of Ed Davey to suggest otherwise.
Scotland offers an excellent model of how to deliver a world-class energy policy. The coalition government could learn much from us.
This piece is one of two that The Conversation has published on this subject today. The other can be be read here.