Ministers warned of increasing threat to UK electricity supplies

10 March 2004 - The Independent; London (UK)

BRITAIN IS facing a looming energy crisis because of under- investment in the electricity network, an accelerating programme of power station closures and increased reliance on overseas gas supplies, the Government will be warned today.

There is also growing concern that the big expansion of renewable energy planned by ministers will not be enough to bridge the gap created by the phasing out of nuclear and coal-fired stations, except at the cost of unacceptably high electricity bills.

A raft of reports published today will highlight the threat posed to the UK. The influential Commons Trade and Industry Committee is expected to warn that while power cuts on the scale seen in the US and Italy last year are unlikely to happen here in the short term, there is an urgent need to increase investment in electricity transmission and distribution.

Meanwhile, a report from the Royal Academy of Engineering says the Government's reliance on offshore wind energy to meet the UK's environmental targets and guarantee security of supply could result in a doubling of electricity prices. "If we don't get our energy policy correct and affordable, we run a real risk of blackouts in the future," the society's vice-president, Philip Ruffles, said yesterday. His comments echo repeated warnings from the power industry itself that the UK is storing up trouble. Ian Russell, the chief executive of ScottishPower, said: "Demand is rising, there are very few new power stations being built, coal-fired plant will start to close soon because of tougher environmental requirements, wind power is expensive and there is little financial incentive to invest in energy efficiency. Put all that together and you have an issue about security of supply." David Porter, the chief executive of the Association of Electricity Producers, also warned that Britain's electricity industry was facing a crunch in the next few years. "There are enough power stations around now to meet demand if we can lure them back on to the system with higher prices. But we have a number of closures of nuclear and coal-fired stations coming up and the only alternative is renewable energy which is not coming on stream as fast as the Government would wish. There are some really serious issues to debate."

Coal-fired stations, which last year produced 35 per cent of Britain's electricity, will begin closing in 2008 when a new Brussels directive designed to curb acid gas emissions from large combustion plant comes into force. Britain's ageing Magnox nuclear reactors will also start to shut.

Although there are planning consents to build seven new gas- fired stations with a combined capacity of 5,500 megawatts, these expire in 2005 and none are likely to get the go-ahead soon because of the high price of natural gas.

There is also mounting concern about under-investment in the UK's pounds 16bn transmission network, blamed by some for the power blackouts last summer in London and Birmingham. The National Grid is replacing only 1 per cent of its network a year and reckons it needs to double investment to pounds 300m a year to keep pace.

Meanwhile, the distribution companies need to increase investment to connect up the new sources of renewable energy.

A BBC documentary tonight will paint an apocalyptic vision of a Britain plunged into darkness by a terrorist attack on a Russian gas terminal, which cuts off supplies to UK power stations. A report by the disaster recovery group NCC calculates that half the UK government and a third of business would face shutdown in the event of a blackout lasting more than 24 hours.