Ed Miliband’s focus on wind and solar power is myopic
Ed Miliband’s promise that greening the grid would cut energy bills has quietly been ditched
LAUREN HURLEY/DESNZ
When Rachel Reeves delivers her budget on Wednesday a keen eye will be kept on stealth tax rises, such as the further freezing of income tax thresholds. Britons, however, need not wait for the chancellor’s speech to learn how the government is introducing costs through the back door. Last Friday the energy regulator, Ofgem, announced that gas and electricity bills will rise by 0.2 per cent next year. The rise was a surprise, following predictions of a lowering of the energy price cap due to a fall in wholesale prices.
The increase is due in part to the government’s “sprint for wind” requiring the national grid to be refashioned to transport electricity from offshore windfarms to Britain’s urban heartlands. Labour’s quest for a net-zero grid by 2030 will ensure that bills, already £700 higher on average than in 2021, remain high. The promise of Ed Miliband, the energy secretary, that greening the grid would result in average cuts to bills of £300 by 2030 has been quietly ditched.
Modernising Britain’s energy infrastructure and how to pay for it will be a potent issue at the next election. Should it be the consumer, saddled with ever-higher fixed green charges, or the taxpayer, in the form of direct investment in the system?
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That dilemma is only part of the story, however. Britain faces an energy crunch in the next five years that threatens continuing price instability and perhaps even blackouts. As old gas-fired and nuclear power stations are retired, a highly urbanised society of almost 70 million will be left increasingly dependent on the vagaries of wind and solar. Medium-term energy insecurity is an intense threat to Britain’s prosperity and national security. Data centres devour energy and if this country wants to ride the AI wave it must promise investors a stable grid. Sundar Pichai, chief executive of Google’s parent company Alphabet, warned last week that an inadequate energy supply would hamper expansion here.
Traditional gas-fired stations, cheap and quick to build, can meet surges in demand. But Mr Miliband does not want so-called unabated gas. He wants any new gas stations to be encumbered by expensive carbon capture, deterring timely investment. To become more dependable, wind and solar need battery storage, a wholly immature technology. Reliance on interconnectors importing foreign power compromises security.
An obvious solution is ramping up nuclear power, recklessly neglected by previous administrations. Britain needs a mix of Sizewell-sized behemoths and as many as 100 small modular reactors (SMRs). These are prefabricated plants that get cheaper as more are built. Rolls-Royce is a world leader in this technology. At last, three of its SMRs have been approved for the Wylfa site on Anglesey. But this promising technology is not fully approved and will take time to arrive.
Nuclear is also bedevilled by a regulatory culture that insists on gold-plating and allows easy challenge by pressure groups. Judicial review, that constant enemy of progress, and capped legal costs for challengers, ensures projects become bogged down, resulting in crippling interest payments. Weather-dependent renewables cannot be the sole solution to an energy gap. Britain needs “dispatchable” power that can be ramped up immediately for the winter evening surge, when workers get home and radiators, kettles and toasters are switched on. Britain allegedly narrowly escaped a blackout in January when the wind dropped. Mr Miliband should know that if such a blackout were to occur on his watch, he himself would be toast.
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A sensible solution to this coming crunch is an interim new fleet of traditional gas-fired stations, allowing nuclear to catch up. But at the Department for Energy Security and Net Zero, with its green dream of 2030, reality is slipping away.