New Government rules on energy policy could lead to a second 'dash for gas', delaying critical investment in renewables and other low carbon technologies and making the UK’s climate change targets impossible to achieve - MPs on the Energy and Climate Change Select Committee warn in a report published today.
Tim Yeo MP, Chair of the Committee said:
"If we want to keep the lights on and create an energy system fit for the future then new rules are needed to fast track energy projects through the UK’s notoriously glacial planning system.
If these new policy statements don’t put the cleanest forms of energy at the top of the agenda they will leave us dangerously dependent on fossil fuels.
The UK’s energy security and our prospects for creating a successful low-carbon economy depend on the Government kick-starting a dash for low-carbon technology, not a new dash for gas."
The Department for Energy and Climate Change has said that £200 billion of new investment in energy infrastructure is needed by 2020 to cope with rising demand and meet targets on renewable energy and climate change.
The six draft National Policy Statements (NPSs) are designed to speed up the planning process for major energy projects to help facilitate this investment, but the new drafts do not prioritise low-carbon generation and renewables over conventional capacity.
The committee's findings
The committee sees a continuing role of abated gas generation in order to provide baseload power, as well as unabated gas capacity for peak time use. However, the report warns that the development of too much gas capacity could crowd out opportunities for renewables to form a substantial component of the UK’s energy mix.
The committee is also sceptical about the ability of the Government to deliver its aims on nuclear power. Ministers told the Committee that the NPSs should enable the development of 16 GW of new nuclear plant by 2025. That is two new nuclear plants each year.
Tim Yeo MP added:
"Hooking up this amount of new nuclear and other generation to the National Grid poses an unprecedented challenge.
Two plants a year is a very high target to reach.
The NPSs lack any real framework for coordinating the process of setting and linking up the new power stations."
The MPs also call for more clarity in coordinating developments. As it is, the NPS leave it up to the market to decide where the £200 billion of energy sector investments that the Government is hoping for will go.
The report stresses that political certainty is essential for investors who are having to make decisions with planning horizons sometimes over several decades.
It raises concerns about the level of investment uncertainty created by giving Ministers the ultimate power to decide on planning decisions. The MPs call on the Government to publish criteria against which the Secretary of State should exercise his or her discretion.
The first so-called 'dash for gas' took place in the 1990s and helped to provide affordable energy, but a second dash for gas could crowd out the development of renewables and make the UK miss its climate change targets, the MPs warned.