What are the UK’s Options for Improving the Security of Energy Supplies?

Economics, Environment, Long reads, Long Reads
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The United Kingdom was the country to kick-start the Industrial Revolution, discovering means to convert chemical energy found in coal into kinetic energy that could power machines of all kinds. This began the world’s every-growing thirst for energy, mainly in the form of electricity. Today, unlike over the last 2 centuries, the United Kingdom’s energy supplies are very much varied, with natural gas, oil, and renewable energy sources such as wind and hydroelectric power as well as coal providing significant portions of total energy generation. Energy security is “the uninterrupted availability of energy sources at an affordable price” according to the International Energy Association. With such changes in the way energy is being produced, how can the UK in the future improve its energy security?

Currently, 9.2% of total energy consumption in the UK is provided through coal and 41% globally, a massive fall from 40% of total energy being produced by coal in 2012. The UK does plan to close down the country’s eight remaining coal-fired power plants by 2020. This is because of environmental reasons such as the fact that coal releases a number of harmful pollutants, such as sulfur dioxide, and greenhouse gases, such as carbon dioxide, which accelerate climate change. The UK is legally committed to meeting 15% of the nation’s energy demand from renewable sources by 2020. It is striving to meet that goal through large renewable energy projects such as the London Array, and encouraging homeowners to make renewable energy choices, such as the installation of solar panels.

The rate at which the UK government phases out coal through the ending of coal subsidies has a large impact of its future energy security. Coal is currently the cheapest means of producing electricity. Although the price of renewable energy sources is falling quickly, according to the British Infrastructure Group government targets for closing coal power plants will radically decrease generation and increase prices. The report found that the country’s spare electricity margin has fallen steadily from around 17% during the winter of 2011-2012 to around 1% this winter. To plug the gap the report says that household bills could, by 2020, increase by as much as £30 a year. This is nearly double the government’s present estimate.

There is no doubt that even at the moment renewable energy sources have the potential to provide enough power for the UK: solar energy is the conversion of light (mainly from the sun) into electricity, whilst wind turbines do the same thing with kinetic energy present in the movement of air. Another is hydroelectric energy. These are all renewable sources- they will most certainly not run out within the foreseeable future. Already large projects of each of these exist and are in operation: Wymeswold solar farm is an array of over 130,000 solar panels, which was completed within eight weeks. It provides energy for 7500 homes. Similar projects exist for other methods of renewable energy.

Including nuclear, around 46% of the UK’s electricity in 2016 was generated through renewables. Renewable energy has several boons clearly not present in fossil fuels. Firstly, they do not release greenhouse gases and harmful pollutants. Secondly, upon their construction the cost of generation is no longer as reliant on commodity prices, unlike oil and coal. Currently, instability in the Middle East and Eastern Europe has a large impact on oil and natural gas supplies, respectively, a key imperfection in fossil fuels that will later be discussed. In addition, natural gas reserves in the North Sea are beginning to peak, threatening to increase further the UK’s dependency on other nations. At the moment, energy dependency is 42%. Although solar panels and wind turbines are heavily dependent on the prices

However, green energy currently has two large flaws. Firstly, they are dilute, and secondly they are intermittent, that is, there cannot be guaranteed a constant supply. Since light or wind cannot be stored during periods of surplus, whilst there is a deficit fossil fuels will have to be used to provide energy. It is very expensive to continually have to switch between different sources of electricity- Germany, who has replaced a lot of its fossil fuels with renewable energy, constantly has to turn on its coal plants, and thus its consumers face the highest energy costs in Europe. In this scenario, where many cannot afford energy on demand, energy security has not or has barely been achieved.

Therefore, to reach the UK’s environmental targets whilst retaining energy security it is critical to increase subsidies in green energy technology and phase out coal as improvements are made to clean energy generation, as opposed to before. Given the state of current technology, they can provide a substantial part of but not all of electricity or energy generation because of their unreliability and inefficiency stated above. However, this may change with technological advances.

One option for improving the security of energy supplies with renewable energy is investing in replacing current battery supplies. The Engineering and Physical Sciences has highlighted the need to improve batteries if we wish to make renewable energy one of or the main method of electricity generation. Currently, the battery market is far behind current technology and lithium-ion batteries are expensive, although large reserves still exist in the UK. No such problems exist for fossil fuels, as the fuel themselves can be easily stored physically. The same is true to some extent with hydroelectric energy.

In addition, at the moment solar panels, wind turbines and hydroelectric dams require very high capital investment- a lot of new infrastructure needs to be designed and constructed, unlike the existing system of fossil fuels. Therefore, there is much question whether at the moment this renewable energy is a cost-effective means of electricity that will increase energy security.

However, technology has made vast improvements. The price of solar panels has fallen by 95% since 2008. Energy cost per kilowatt for wind energy has decreased 10 times since 1980. Large-scale implementation of sustainable energy now (which will be necessary to meet the gap left by coal) may be quickly made out of date. Since that infrastructure will be spread across the country, for example on roofs in urban and suburban areas, the cost of updating and implementing new technology will be much greater than for fossil fuels- all of the UK’s coal electricity generation (9.1%) can be done in 8 plants.

Indeed, another event that will occur upon the increasing of renewable energy subsidies is that the price of energy produced through fossil fuels and the fossil fuels themselves will fall, as companies increase production and decide to lower profit margins in order to compete. This will once again force the government to increase subsidies to incentivise consumers to choose renewable energy over cheaper fossil fuels.  

Once more, perhaps it is necessary to wait for further technological developments, including those in batteries, to begin phasing out fossil fuels, specifically coal and to an extent natural gas, to be replaced by renewable energy.

Therefore, one must accept that now and in the near future a more energetically secure Britain has to mainly feature fossil fuels. This raises two key questions: which fossil fuels are cheap, efficient and environmentally friendly enough to be the main provider of energy, and secondly, how can we guarantee a sustainable and reliable supply of those fossil fuels that will last in a stable manner into the foreseeable future. Both of those questions are closely interrelated.

The UK government has largely advanced the policy that natural gas is the fossil fuel best suited to meet the energy needs of the country. In proportion for energy produced it releases under half the amount of carbon dioxide as coal, around on par with oil. By replacing coal energy generation with gas, the UK government would still be able to reduce emissions whilst decreasing long-term costs and dependency on coal imports from Russia, a country with which the UK has weak political relations.

After the discovery of vast natural gas reserves in the North Sea, the resource has grown to be the largest generator of electricity, with in 2016 over 40% of electricity generated through natural gas. As it is liquid it is easy to transport and the fossil fuel that is most efficient when it comes to energy released in comparison to amount of fuel used. Therefore it is currently used for heating 4 out of 5 homes and commonly in industrial processes, such as the production of gas, steel, cement and bricks. In 2015 the UK consumed 67 billion cubic metres of gas. Natural gas is indeed the ideal fossil fuel for electricity generation at least when it comes to its chemical nature.

However, natural gas reserves in the North Sea have begun to peak. In the North Sea where vast reserves of oil and natural gas lie, manipulation of these resources made Britain a net exporter of hydrocarbons in the 1980s and 1990s. Today rising demand has made Britain an importer. From 2001 to 2010 North Sea petroleum production fell by almost 100 billion barrels. It has thus become clear that the greatest issue with natural gas is whether the UK can ensure that there is a constant and sustainable supply that will not only be able to meet current energy demand, but is ready to account for increases as well in energy consumption.

A key goal of energy policy in general is to ensure that the level of energy dependency, that is, the portion of the country’s energy consumption that is reliant on other countries to meet that demand. At the moment the energy dependency for the UK is 42%, with coal imported from Russia and the US, gas from Norway and uranium from Kazakhstan. This threatens energy security because political and economic instability in those nations would affect supplies in the UK. As the UK decides to leave the European Union the natural gas supply would be threatened by tariffs, creating the possibility that prices will increase.

To increase energy security it is key to reduce those invulnerabilities.

This can be done in multiple ways. Firstly, the solidification of political relations with countries upon which the UK relies for energy is an option. Europe largely receives its natural gas, which it uses for energy from Russia, a country with whom it has fractious relations. In the winter of 2014-2015 in a dispute over pricing and payment Gazprom cut the gas supply to Europe by over 50%. In the case of long-term political crises with Russia, such as conflicts, Russia would be able to cripple Europe’s energy supply. Therefore, the UK should try to import gas from countries with politically stable relations, such as Norway. However, at the moment, 38% of the UK’s gas supply comes from European pipelines, 35% of which is supplied by Russia. To improve energy security that percentage must be as low as possible.

Another means of doing so is to increase domestic production of natural gas. At the moment 45% of gas consumption in the UK is provided by domestic supplies. This production can be increased by hydraulic fracturing, more commonly known as fracking. Fracking is the process in which water and sand at high pressure is pumped into rocks, splitting them open and revealing shale gas. In the United States, fracking has decreased the cost of electricity and created employment in the energy industry. There is nothing to suggest that the same would not happen in the UK. By decreasing the cost of energy for industry more businesses would be attracted to the country and the costs of goods produced in the Uk will decrease.

However, there is great political opposition to fracking, with 40% of people opposed to the process in 2016, compared to 26% in favour of it. Environmental groups such as Greenpeace believe that a country committed to combating global warming should not support accessing new supplies of fossil fuels, like through fracking. There are also other flaws: the UK population is far denser than that of the US and many shale oil deposits lie under populated areas, farmland and National Parks. In addition there is the possibility of wastewater contaminating natural supplies and fracking fluid could leak into surrounding aquifers.

There have been several minor earthquakes attributable to fracking, such as two in 2011 near Blackpool. On the other hand, the negative aspects of fracking can be mitigated, such as regulation designed to ensure that fracking companies reduce as much as possible the probability of leakages, accidents and unnecessary pollution. In addition, there are negative social impacts, with the landscape of many areas to be ruined by fracking. However, overall fracking will provide positive economic effects to the UK, whilst allowing the government to in a cost-effective manner utilise less polluting fossil fuels, as opposed to coal, where sustainable have not yet been made practical. Even if only a quarter of estimated shale resources can be manipulated through fracking. this will meet Britain’s gas demand for the next 100 years.

An important means by which energy security can be strengthened is by increasing the energy efficiency of industry and electrical appliances. Means of this include installing insulation to save energy for heating. Another option is to increase the amount of energy produced per kilo of resource: in the UK, the amount of natural gas that will need to be burnt to achieve £1 growth in GDP has halved since the UK according to The Economist. This figure would be a quarter if the latest technology were properly implemented. It is important to invest in implementing these technologies to improve energy security.

In addition, by relocating industrial processes to other countries and simply importing goods and resources, it is possible to lower electricity demand and increase security. From 1970 to 2007, largely a result of industry being moved offshore to countries like China, the amount of electricity used in industry roughly halved. By continuing to pursue this goal Britain’s energy consumption will fall.

In conclusion, environmentally the UK’s best option is to invest in immediately replacing fossil fuels with renewables. However, this is not economical and cannot guarantee Britain’s short and long-term energy security. In this respect, natural gas is the best choice. It is the more efficient, and more environmentally friendly than coal, and cheaper and more reliable than renewables. Technology is being developed, for example by the United States Energy Department, that will make fossil fuels much more sustainable by capturing greenhouse gas emissions.

Historians often refer to the 19th Century as the “Coal Century,” because of the dominant fossil fuel of the time. Many call the 20th Century the “Oil Century,” or “Oil Age.” I am not advancing the notion that the best option for Britain is a “Gas Century”- in reality, while natural gas should play a principal part, overall Britain should pursue a varied range of energy sources to meet the different demands of different areas as conveniently as possible.

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