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Our Energy Trilemma

4 min read

Energy Minister Angela Leadsom outlines the Government’s priorities for energy policy.

In the UK we face a key energy challenge – a problem that governments around the world are also grappling with. I write about the critical importance of keeping the lights on, getting bill-payer costs down, and decarbonising our energy sector; what we term the energy “trilemma”.

The trilemma is not an insurmountable challenge. However, we will only make progress with strong leadership and determination, and this is why I am delighted to be part of the first Conservative-led Department of Energy and Climate Change, with my friend Amber Rudd at the helm.

The UK has long been a world leader in energy production, and we have a wide and complicated range of energy sources in the mix. From renewables to nuclear, carbon capture storage to the possibility of shale, each has a part to play in the transition to our long-term goal of a clean energy future – whilst over 50 per cent of our electricity capacity still comes from coal and gas, last year 19.1 per cent came from renewables and over 21 per cent came from nuclear.


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We import around 40 per cent of the gas that is required for everything from heating our homes to powering industry, and this could rise to around 75 per cent in the next fifteen years. Shale gas could be an important bridge as we move away from the dirty days of unabated coal and, with potential resources of 1,300 trillion cubic feet of shale gas in the north of England alone, it is vital that we explore the possibilities that the safe development of this home-grown energy source could offer.

Investment in new nuclear, which generates reliable low carbon electricity, will play an integral role in helping the UK meet our international obligations to reduce carbon emissions, whilst ensuring we have reliable baseload electricity generation. It is also key that we have the continued long-term investment necessary to maximise the North Sea economic recovery, and this is why we have set up the Oil and Gas Authority to help industry drive down costs and become ever-more efficient.

In their recent annual assessment of economic growth and greenhouse gas emissions, PwC’s Low Carbon Economy Index showed that the UK continues to make the most progress in moving towards a greener economy compared to the rest of the G20 countries, while the US, Germany and Brazil have all slipped backwards in the league table. We remain the global leader in offshore wind deployment, with the UK having over 50 per cent of the world’s offshore wind farms. Our solar PV sector continues to develop and, with the record over-deployment compared to projected levels, we are consulting in-line with our EU State Aid requirements on how to deal with the overspend in the Feed-in Tariff scheme and associated pressures on the Levy Control Framework to ensure that we continue to support this vital industry but not on the backs of bill-payers.

We are also working to improve efficiencies on the demand side, both domestic and industrial. The energy market is much more competitive than it was five years ago and, with 18 new entrants to the domestic market since 2010, there are now 25 independent domestic suppliers meaning greater choice and lower prices for consumers. We want to make it easier for bill-payers to lower their costs by introducing 24-hour supplier switching by the end of 2018. Millions of people have already switched their supplier since we reduced the process time from 5 weeks to 17 days.

In addition to the energy efficiencies the Government has introduced, including helping to insulate 3.8 million lofts and 2 million wall cavities through Government schemes since 2010, we are rolling out smart meters to properties across the country. We’re committed to the aim that every home and business is offered a smart meter by 2020 so that consumers can measure their energy consumption, and we expect this to show bill reductions of £26 per year by the end of this Parliament for the average dual fuel household.

So, whilst the trilemma seems daunting and there are certainly difficult areas to navigate through, the Government is committed to decarbonising, keeping the lights on, and getting bills down. Energy security is non-negotiable, helping hard-working people keep more of their own money is critically important, and reducing greenhouse gas emissions remains a long-term aim of this Government.

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