Energy Security 2

View the Article: http://www.mistergreen.co.uk/news/energysecurity-33.htm

A couple of weeks ago, we wrote about the security of energy supplies and energy diversity. An interruption in the main gas supply pipeline in Europe led to a spike in gas prices. The debate about how far the government should intervene in the market to secure energy stability has been quieter of late, but the death of Margaret Thatcher has brought the debate to the fore. Undoubtedly, Margaret Thatcher was one of the most important prime ministers of the twentieth century, but to put her legacy into context, we have to go back to the other great prime minister of the twentieth century-Clement Atlee. In 1945 the Labour Party won a resounding victory over the Conservatives in the first UK general election after the Second World War, and set about a huge programme of nationalisation of key resources. In 1950, Labour won the election but with a tiny majority and in 1951 Atlee decided to call a snap election-and lost. Winston Churchill formed a Conservative government and further nationalisation ceased- but Churchill did not roll back nationalisation and re-privatise the recently nationalised industries. There was broad agreement that strong government was required to contol market forces- until Margaret Thatcher came along. Certainly, the UK in the 1960's and 1970's was in a poor state. There was huge industrial unrest and low productivity. Margaret Thatcher's solution was to re-privatise and reduce the role of government in controlling and allocating resources. She argued that market forces would do a better job. Which brings us back to energy security and diversity. In the UK currently about 30% of electricity is still from coal fired power stations and about half of the coal used is imported. But coal as an energy source will reduce by 2016 when about one third of coal fired power stations will close down to meet commitments on air quality. The UK will become less reliant on coal and will have to look at alternative energy sources. The government is looking at a mixture of gas, renewables, and nuclear to meet demand. Gas will be bought on the open market and piped across Europe and shipped in tankers; renewables will receive financial support and incentives because they are more expensive to build and develop than conventional energy sources; and nuclear. The government expects nuclear power to play an important role- but how is it going to secure this? Currently, the government is relying on EDF to assess the financial viability of nuclear power in the UK. The decision on whether to invest in nuclear power is with EDF, but...what to the initials EDF stand for? Answer.,.Electricite de France. EDF is the privatised French utility company that is now the world's largest supplier of electricity. But who owns EDF? Answer the French State kept 84% of EDF. The British Government did not keep its investment in utilities. So, which government has more influence over the future of nuclear in the UK- the French Government or the British Government? The British government's energy policy will be in tatters if EDF decides not to invest in nuclear in the UK. So there will be more reliance on imported gas. Anecdotally, private homeowners take energy saving measures in response to energy price rises. The cost effectiveness of energy saving is related to the cost of heating a home. Margaret Thatcher's legacy in terms of energy means that the British government is a the mercy of the market in energy supply and is in a poor position to implement policies to safeguard its citizens. Homeowners are not saving energy for the common good, they are future proofing their homes against energy price shock