The UK’s new ‘dash for gas‘ will have negative environmental and economic impacts for years to come. Chancellor Osborne’s Autumn Statement, delivered last week, sets the course for economic policy for the foreseeable future. Outlined in the Statement is the new gas strategy which sets out commitments to continue investing heavily in gas.
In particular, it signs off on more than 30GW of gas investments through new power plants. This amount of investment indicates that the continued use of gas is being viewed as significantly more than a bridging fuel.
The strategy also pushes the importance of developing an oil shale industry. To create incentives for investment, it outlines giving tax breaks for companies involved in oil shale exploration. The government hopes that the UK will be able to follow the example of the US where overseas oil dependency has been reduced using this tactic. However, the UK does not possess a similiar level of potential to develop to the same extent.
Besides the unrealistic oil shale push, the strategy raises several equally pressing concerns.
Creating further dependence on oil could lock the UK into increased exposure to volatile gas prices. The price of gas has an unpredictable nature but as a general trend it is on the rise. This draws a stark comparison to the predictable prices of renewables and the over trend of falling prices. The gas strategy will not be more energy secure, just as it will not lower energy bills for consumers.
What about renewables?
Largely ignored in the strategy, is the growing field of offshore wind development. A recent report from WWF-UK and Greenpeace suggests that the UK would be £20 billion better off by investing in offshore wind capacities over following a gas intensive, short-term strategy. Investments in offshore developments would contribute to 0.8% increase in GDP by 2030.
Climate change targets
It is impossible to reconcile the new gas strategy with the move to decarbonise the energy sector. The UK’s already dwindling chances at meeting binding climate targets will be all but dashed by pursuing gas investments. Carbon and Capture technology may provide some reprieve but unfortunately this is an area the UK does not excel in.
In relation to providing tax breaks for oil shale exploration, Green MP Caroline Lucas, argues that:
“Gifting tax breaks to companies like Cuadrilla to leach every last bit of fossil fuel from the ground when the IEA is warning that we need to keep this stuff in the ground to avoid dangerous climate change makes a mockery of our claim to be taking a lead in international climate negotiations.”
The new strategy also sends very mixed messages to businesses exploring investment in the green economy. It does not give businesses the confidence to take advantage of the enormous investment opportunities the green sector offers. Leonie Greene of the Solar Trade Association states that:
“The Government should urgently prioritise sorting out the policy framework for renewables, because investment is floundering. Instead it seems to be putting huge resources into promoting fossil fuels…”
There is no doubt that there is an urgent need to fill the gap in energy supply. Investing in gas should satisfy the need in the short-term but it certainly will not on a long-term scale.
The gas strategy fails to consider the repercussions for investment, for the average consumer and ultimately for the climate. It also fails to recognise the economic advantages to investing in renewable technology. Gas should not be viewed as anything more than a bridging fuel. Unfortunately, the UK has committed to treat it as a lot more than that.
What are your thoughts?
Acacia Smith is a New Zealander now based in London. She holds a bachelor degree and postgraduate diploma from Victoria University of Wellington. She has worked for the Council for International Development (CID) and more recently in Bolivia for CIWY, a network of private parks for the rehabilitation and conservation of Amazonian fauna. Acacia is passionate about sustainability and the role businesses can play in promoting a better, more sustainable future.