Agenda
Challenges
The UK is facing a 23 GW decrease in its power generation capacity by 2020 due to the decommissioning of the majority of the country’s coal and nuclear power plants. At the same time the UK’s own energy resources are declining to the extent that by 2020 80% of the country’s fuels will have to be imported.
Political
To address these challenges, the UK’s energy policies aim to enhance security of supply whilst also contributing towards the protection of the environment. For example, £525 million was made available for the development of offshore wind energy projects in 2009. However, given the extent to which the energy market in the UK is privatised, the government’s scope for action has been limited.
Status
Energy Policy
Energy policy in the UK is run along market principles after decades of privatisation, which started in the 1980’s and continued into the 1990’s. However, this process has become increasingly controversial with critics arguing that “markets fail to work in the face of scant supply … They cater for today’s generation, not tomorrow’s.”
This is problematic given that the UK will lose 23GW of power generating capacity by 2020 due to closures of nuclear and coal plants. At the same time up to 35GW of new power generation is required due to these closures as well as expected rises in demand. It is estimated that up to £200 billion of investment is required to achieve this.
Composition
The UK budget for 2009 assigned £1.4 billion to support low-carbon energy projects.
Institutional Structure
The Department of Energy and Climate Change (DECC)
DECC is the governmental department responsible for formulating and implementing the UK’s energy policy. It was only created in October 2008, as energy policy was previously the responsibility of the Department for Business, Innovation and skills.
The Energy and Climate Change Committee (ECCC)
The ECCC is the parliamentary committee responsible for examining the policies, expenditure and administration of the DECC. The Committee is part of and reports to the House of Commons.
The Office for Gas and Electricity Markets (Ofgem)
Ofgem is the industry regulator for gas and electricity markets in the UK. Its first priority is ensuring affordability for consumers, which it tries to achieve through promoting competition wherever possible, and regulating companies in the energy sector.
Budget
Money and Energy Markets
Given the extent to which the UK’s
energy markets have been privatised, the majority of funding for developments
in the area of energy comes from the private sector itself. For example, the
government hopes that the private sector will deliver investments of up to
£15bn to deliver the modification necessary for planned offshore electricity
transmission.
Ofgem
However, in 2009 the government has assigned funds in the area of energy, with
the aim of contributing towards the expansion of low-carbon energy as well as
enhancing energy efficiency. For example, £525 million will be made available
for the development of offshore wind energy projects.
£375 million of governmental funding has also been made available for energy
efficiency measures. Of this, £100 million will be used to improve the energy
efficiency of small businesses and £100 million will be used to ensure that new
homes are as energy efficient as possible.
Renewable Energy Focus
Key Policies
Energy Performance Certificates (EPCs)
An EPC is required for every building being built, sold or rented out in the UK. The certificate gives an energy efficiency rating for the building in question, from ‘A’ to ‘G’. ‘A’ denotes a building with an extremely high degree of energy efficiency and ‘G’ means the building is highly inefficient. ERCs are produced by accredited energy assessors. It is hoped they will lead to owners of buildings investing more to make them more energy efficient.
Carbon Emissions Reduction Target (CERT)
Running from 2008-2011 CERT obligates suppliers of energy to “…deliver measures that will provide overall lifetime carbon dioxide (CO2) savings of 154 million tonnes of CO2.” It is estimated that this will cost energy suppliers £2.8 billion. One example of an initiative energy suppliers in the UK have adopted is investing in the homes of customers, for example through paying for more effective house insulation, in return for the customer agreeing to a fixed long-term energy contracts.
Smart Meters
The Government has announced plans for 50 million so-called “smart meters”, used for measuring energy consumption. As such, it is hoped they will contribute to more efficient energy use and ultimately save consumers up to £5.98 billion over 20 years. It is also hoped that this increased energy efficiency will mean 15 million tonnes less CO2 emissions over a 20-year period.
Transition to Globalisation
Emissions Regulations
47% of the UK’s carbon emissions come from buildings. The government has therefore reformed regulations for all new building being built. Houses being built in 2006 are therefore 70% more energy efficient than those build pre-1990.
In 2007 the government announced plans to ensure that by 2016 all new homes being built will have net carbon emissions of 0%.
Globalisation > Construction > Buildings
In 2006 the UK had 4 billion barrels of proven crude oil reserves and in 2005 the country consumed 1.8 million barrels per day. However, its overall contribution to the UK’s energy mi has declined over time from 37% in 1983 to 35% in 2003. Domestic oil production is also now in decline after peaking in 1999.
Globalisation > Economy > Energy > Sources > Non Renewable > Oil
In 2013 UK mainly derived its electricity from gas, coal and nuclear power.
Globalisation > Economy > Energy > End Use > Electricity
Transition to Political Tools
The UK and Russia
The UK already derives much of its electricity from gas and this is expected to rise by 2% each year until 2015. Given the UK’s domestic gas supplies are in decline, it is very likely that the country will become increasingly dependent upon gas imports from Russia.
Political Tools > National > Russia
Transition to Political Actors
UK Energy Research Council
The UK’s Energy Research Council describes itself in the following way:
“The UK Energy Research Centre is the focal point for UK research on sustainable energy. It takes an independent, whole-systems approach, drawing on engineering, economics and the physical, environmental and social sciences. The Centre's role is to promote cohesion within the overall UK energy research effort. It acts as a bridge between the UK energy research community and the wider world, including business, policymakers and the international energy research community, and is the centrepiece of the Research Councils' Energy Programme."
Political Actors > NGOs > Energy
RenewableUK
The BWEA describes itself in the following way: “Our primary purpose is to
promote the use of wind, wave and tidal power in and around the UK. We act as a
central point for information for our membership and as a lobbying group to
promote wind energy and marine renewables to government, industry, the media
and the public.”
Political Actors > Business > Interest Organisation > British
Wind Energy Association
RenewableUK
