The energy challenge in the face of dwindling supplies of coal, oil and gas

We must harness resources such as wind and nuclear power to create a sustainable and low-carbon economy

Britain faces an energy challenge in the coming decades which is unprecedented, and all the more formidable for being double-faced. It would be bad enough if the challenge were just to keep the lights on. Four factors will make that a tough job, and make our supply of domestic energy considerably more problematic in the near future: the soaring global demand for fossil fuels; the costs, risks and difficulties of extracting them from ever more difficult places such as the deep waters of the Gulf of Mexico; the drying-up of our own oil gusher, the North Sea; and the coming obsolescence of a substantial part of our own electricity-generating plant.

Yet that’s only the half of it. The task facing the UK is not only to provide the population with a secure and affordable energy supply – it is to do so while simultaneously cutting national emissions of carbon dioxide, the principal greenhouse gas, by 80 per cent by 2050, as the linchpin of our action against climate change. That means moving away from the fossil fuels, the coal, oil and gas which produce it, in a colossal technological shift. It means creating the low-carbon economy.

But although these two aims of keeping the lights on and cutting carbon at the same time make the effort seem twice as big, they complement each other. If supply and price insecurity are major future risks of fossil fuels, seeking low-carbon alternatives, especially home-produced ones, is the obvious answer.

On the supply side, there is no doubt about the risk. Driven by the huge surge in population and wealth of the emerging economies such as China and India, demand for oil, gas and coal is soaring: according to the International Energy Agency, global demand for primary energy will rise by 40 per cent by 2030.

The availability and price of oil, in particular, may further be threatened as easily extracted supplies gradually run down and sources have to be sought that are more difficult to get at technically, such as BP’s Deepwater Horizon well off Louisiana, which exploded this year with disastrous consequences, or that are more politically contentious, such as the tar sands of Alberta in Canada.

The key factor, however, is the increase in Britain’s energy vulnerability.

More than half of all the known reserves in the North Sea have now been extracted, and, more importantly, more than 70 per cent of Britain’s own share (we split it with Norway) has been used up. North Sea oil production peaked in 1999, when more than 2.5 billion barrels were produced; this had plunged to 1.4 billion by 2007, a decrease which led to Britain becoming a net importer of crude for the first time in decades. (Production is expected to fall still further, to perhaps 800 million by 2020.)

We import 8 per cent (net) of our oil, 32 per cent of our gas and 70 per cent of our coal. But by 2020, our oil-import dependence is likely to be in the region of 45-60 per cent, and some estimates suggest gas-import dependency could be 70 per cent or more. The vulnerability to suppliers who could turn off the tap – no names, no pack drill, but did I hear you mention Russia? – is obvious, as is the solution: supply diversification.

It is to low-carbon forms of energy production that we need to turn, principally onshore and offshore wind power, nuclear power, and the burning in power-generating plants of |coal, gas and oil whose emissions are dealt with by the emerging technology of Carbon Capture and Storage (CCS), where the CO2 produced by combustion is trapped, liquefied and pumped down into deep geological formations, perhaps under the seabed, where (it is hoped) they will be permanently sequestered.

That has been done on a very small scale in the North Sea, but it is still an untried technology on the scale of a big 1,000MW power station, say, and the Government is organising competitions for four pilot plants which can test the idea out in full. It is hard to overemphasise just how vital CCS will be, principally because we will still need fossil fuel-fired plants as part of the energy mix for years to come, just to provide the “base load”, the steady supply of electricity which is always in the background.

But no new coal-fired plants will be built without CCS; so if CCS does not work, we are in deep trouble. And in fact, we will need new plants very soon, since, in a problem peculiar to Britain, about a quarter of our generating capacity will close by 2020, as old nuclear power stations come to the end of their natural lives and some of our biggest coal-fired power stations will have to shut down because of stringent new EU air-pollution rules.

This represents the “energy gap,” and is one of the reasons why the political establishment has turned back to the idea of nuclear energy. New nuclear power is increasingly regarded as necessary for a low-carbon economy, as – at least at the point of energy generation – it produces virtually no CO2; but it remains politically contentious, and its economics are difficult, and it is years away from coming on-stream.

In the meantime, the lion’s share of the provision of low-carbon energy will fall to wind power: thousands upon thousands of wind turbines will begin to cover the coastal waters of Britain, as well as our windy hills. As long as companies are prepared to install them. And there lies the final part of the energy challenge facing Britain. Who is going to pay for installing the low-carbon economy? It won’t be the Government putting up new CCS coal plants, nuclear-power stations, and wind turbines by the thousand. It will have to be the private sector.

So the final challenge is to make sure private companies will do it, even though it will be more costly than ever. In the

past, much of the cost of energy generation was spread over a plant’s life, as the main cost items were found in the fuel it burnt over many years – the gas, the coal and the oil – rather than the costs of construction. But with low-carbon energy infrastructure, the costs are all upfront. Making sure companies are willing to do this may require reforming the energy market, so they can receive a guaranteed return which prompts them to enter the market in the first place.

It’s just one more aspect of the difficulties that face us as Britain tries to construct an energy policy that deals with energy supply, and energy insecurity, and energy investment, and climate change, in increasingly unfavourable circumstances.

When you think about it, “challenge” seems an understatement.



Suggested Topics
Voices
There will be a chance to bid for a rare example of the SAS Diary, collated by a former member of the regiment in the aftermath of World War II but only published – in a limited run of just 5,000 – in 2011
charity appealTime is running out to secure your favourite lot as our auction closes at 2pm tomorrow
Arts and Entertainment
Mark Wright has won The Apprentice 2014
tvThe Apprentice 2014 final
Arts and Entertainment
X Factor winner Ben Haenow has scored his first Christmas number one
music
News
i100
PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
Life and Style
ebookNow available in paperback
Life and Style
ebooksA superb mix of recipes serving up the freshest of local produce in a delicious range of styles
News
news
Arts and Entertainment
James May, Jeremy Clarkson and Richard Hammond in the Top Gear Patagonia Special
tv
News
File: James Woods attends the 52nd New York Film Festival at Walter Reade Theater on September 27, 2014
peopleActor was tweeting in wake of NYPD police shooting
News
Claudia Winkleman and co-host Tess Daly at the Strictly Come Dancing final
people
Extras
indybest
News
peopleLiam Williams posted photo of himself dressed as Wilfried Bony
Sport
Martin Skrtel heads in the dramatic equaliser
SPORTLiverpool vs Arsenal match report: Bandaged Martin Skrtel heads home in the 97th-minute
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs General

    Recruitment Genius: Telesales & Customer Service Executives - Outbound & Inbound

    £7 - £9 per hour: Recruitment Genius: Are you outgoing? Do you want to work in...

    Recruitment Genius: National Account Manager / Key Account Sales

    £30000 - £35000 per annum: Recruitment Genius: An opportunity has arisen for a...

    Recruitment Genius: Operations Manager

    £30000 - £35000 per annum: Recruitment Genius: An exciting opportunity to join...

    Recruitment Genius: Recruitment Consultant

    £30000 - £35000 per annum: Recruitment Genius: We have an excellent role for a...

    Day In a Page

    The week Hollywood got scared and had to grow up a bit

    The week Hollywood got scared and had to grow up a bit

    Sony suffered a chorus of disapproval after it withdrew 'The Interview', but it's not too late for it to take a stand, says Joan Smith
    From Widow Twankey to Mother Goose, how do the men who play panto dames get themselves ready for the performance of a lifetime?

    Panto dames: before and after

    From Widow Twankey to Mother Goose, how do the men who play panto dames get themselves ready for the performance of a lifetime?
    Thirties murder mystery novel is surprise runaway Christmas hit

    Thirties murder mystery novel is surprise runaway Christmas hit

    Booksellers say readers are turning away from dark modern thrillers and back to the golden age of crime writing
    Anne-Marie Huby: 'Charities deserve the best,' says founder of JustGiving

    Anne-Marie Huby: 'Charities deserve the best'

    Ten million of us have used the JustGiving website to donate to good causes. Its co-founder says that being dynamic is as important as being kind
    The botanist who hunts for giant trees at Kew Gardens

    The man who hunts giants

    A Kew Gardens botanist has found 25 new large tree species - and he's sure there are more out there
    The 12 ways of Christmas: Spare a thought for those who will be working to keep others safe during the festive season

    The 12 ways of Christmas

    We speak to a dozen people who will be working to keep others safe, happy and healthy over the holidays
    Birdwatching men have a lot in common with their feathered friends, new study shows

    The male exhibits strange behaviour

    A new study shows that birdwatching men have a lot in common with their feathered friends...
    Diaries of Evelyn Waugh, Virginia Woolf and Noël Coward reveal how they coped with the December blues

    Famous diaries: Christmas week in history

    Noël Coward parties into the night, Alan Clark bemoans the cost of servants, Evelyn Waugh ponders his drinking…
    From noble to narky, the fall of the open letter

    From noble to narky, the fall of the open letter

    The great tradition of St Paul and Zola reached its nadir with a hungry worker's rant to Russell Brand, says DJ Taylor
    A Christmas ghost story by Alison Moore: A prodigal daughter has a breakthrough

    A Christmas ghost story by Alison Moore

    The story was published earlier this month in 'Poor Souls' Light: Seven Curious Tales'
    Marian Keyes: The author on her pre-approved Christmas, true love's parking implications and living in the moment

    Marian Keyes

    The author on her pre-approved Christmas, true love's parking implications and living in the moment
    Bill Granger recipes: Our chef creates an Italian-inspired fish feast for Christmas Eve

    Bill Granger's Christmas Eve fish feast

    Bill's Italian friends introduced him to the Roman Catholic custom of a lavish fish supper on Christmas Eve. Here, he gives the tradition his own spin…
    Liverpool vs Arsenal: Brendan Rodgers is fighting for his reputation

    Rodgers fights for his reputation

    Liverpool manager tries to stay on his feet despite waves of criticism
    Amir Khan: 'The Taliban can threaten me but I must speak out... innocent kids, killed over nothing. It’s sick in the mind'

    Amir Khan attacks the Taliban

    'They can threaten me but I must speak out... innocent kids, killed over nothing. It’s sick in the mind'
    Michael Calvin: Sepp Blatter is my man of the year in sport. Bring on 2015, quick

    Michael Calvin's Last Word

    Sepp Blatter is my man of the year in sport. Bring on 2015, quick