How many times has Ed Miliband told us that his renewable energy policies were helping to free us from ‘fossil fuel dictators’? Wind and solar energy, he assures us, are saving us money and making us more energy-secure. Then we wake up to find that actually, Britain has only two days’ worth of gas left in storage.
If the people who run our gas network were to go on all-out strike we wouldn’t last five minutes
It has been clear for a long time that Miliband’s claims are somewhat contrary to reality. If Britain’s net zero policies are really helping to bring down prices, then how come UK households – even before the current crisis – were paying twice as much for their gas and two and half times as much for their electricity as US consumers? And no, the Energy Secretary can’t blame global gas prices for setting our high electricity costs: actually, the US generates a higher proportion of its electricity from gas than does the UK.
But the war has exposed Miliband’s claims for what they are: utter fantasy. There is not the remotest chance that Britain could end its reliance on fossil fuels in the foreseeable future; even Miliband’s increasingly unrealistic target of reaching 95 per cent zero carbon electricity by 2030 involves keeping a fleet of gas power stations to make up for the times when solar and wind energy are short. Moreover, only a sixth of the total energy consumed in Britain is delivered in the form of electricity. Even in 2024, with the North Sea well down from its peak, the UK still produced six times as much energy from oil and gas as it did from wind and solar. Renewables have done little to arrest Britain’s growing dependency on energy imports. In 2024, we produced only 43.8 per cent as much energy we consumed, up from 3.4 per cent on 2023. As recently as 2003, we were net exporters of energy.
If Miliband was really interested in energy security, the first thing he would do was lift his ban on new oil and gas exploitation in the North Sea. Even Greg Jackson, CEO of Octopus, which is as green an energy company as they come, is now telling him to do this. He would also address the acute shortage of gas storage facilities. The irony is that the UK has ready-made places for this, in the shape of empty aquifers from which natural gas has been extracted. This is what the Rough gas storage facility, off the Yorkshire coast, is. But our energy market does not incentivise the provision of such facilities. Rough was even decommissioned by Centrica in 2017 before being reopened five years later during the Ukraine crisis.
If we can’t store gas we don’t necessarily run out of it, but it means that we end up having to pay through the nose to keep homes, businesses and power stations supplied when they need the fuel. Gas is a lot cleaner than the coal it has now entirely replaced in the energy mix, but it is very much more difficult and expensive to handle and transport. In 1984/85, it might be remembered, the then nationalised National Grid succeeded in keeping the lights on for 11 months during the miners’ strike. That was possible because the Thatcher government, sensing what was to come, stockpiled coal at power stations. If the people who run our gas network were to go on all-out strike we wouldn’t last five minutes.
The Iran crisis has exposed another Miliband delusion. He keeps trying to tell us that it would make no difference to UK consumers if we increased gas production because it would just be sold on global markets at the global price. But unlike oil there is no global price for gas. There is a huge variation in wholesale prices around the world – thanks to it being a much more difficult fuel to transport. In 2022, European wholesale gas prices spiked five times higher than those in the US and have remained at a prevailing rate of three times higher ever since. This is very much because the US is exploiting its gas reserves – including shale gas reserves – to the full and Europe is not. Britain, with its lack of storage to tide over short-term price fluctuations, is in the worst position of all.
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