In parliament >> A whole bunch of dilemmas

10th November 2011

Related Topics

Related tags

  • Mitigation ,
  • Generation ,
  • Conventional



Alan Whitehead MP details the problems facing the government in its bid to reform the electricity market

Frenetic preparations are currently under way in DECC to translate the principles and outline timescales set out in the electricity market reform white paper into meaningful mechanisms that can regulate the electricity market firmly in favour of customers, as well as usher in the long-term replacement of, and investment in, the low-carbon energy plants and smart grid structures that will serve to keep the lights on and emissions down to perhaps 100g of carbon per kilowatt hour by 2030 – it is approximately 450g currently.

The plan is to complete the detail of the reforms in time for a Bill to go through parliament in early 2012, but that timetable looks to be slipping substantially. It is now likely that it will not come before the house until the end of next year. That is perhaps not surprising, because there are several significant dilemmas still to be resolved. One of them is where the estimated £200 billion of investment will come from. It is hoped the large energy utilities will provide a lot of it, but looking at the major energy companies’ balance sheets, I’m not sure if they can carry too much new investment.

Another dilemma is that the existing electricity market doesn’t really work. The big six are now an effective, if accidental cartel: they own much of the country’s generating capacity, and some 99% of retail supply. Should some sort of open pool system be introduced into which all suppliers have to sell their wares transparently, or will the “market” as it stands, with some bells and whistles attached, do the job?

The signs are that the government will produce a modified electricity market that doesn’t really deliver. It is time, I think, to take a more radical approach, such as interconnectors with the rest of Europe to supply reliable energy when variable (renewable) supply doesn’t deliver, and decentralised grids. Getting it wrong will mean that we will be locked into a centralised, probably high-carbon system for years.


Subscribe to IEMA's newsletters to receive timely articles, expert opinions, event announcements, and much more, directly in your inbox.

Transform articles

Weather damage insurance claims hit record high

Weather-related damage to homes and businesses saw insurance claims hit a record high in the UK last year following a succession of storms.

18th April 2024

Read more

The Scottish government has today conceded that its goal to reduce carbon emissions by 75% by 2030 is now “out of reach” following analysis by the Climate Change Committee (CCC).

18th April 2024

Read more

The Science Based Targets initiative (SBTi) has issued a statement clarifying that no changes have been made to its stance on offsetting scope 3 emissions following a backlash.

16th April 2024

Read more

While there is no silver bullet for tackling climate change and social injustice, there is one controversial solution: the abolition of the super-rich. Chris Seekings explains more

4th April 2024

Read more

One of the world’s most influential management thinkers, Andrew Winston sees many reasons for hope as pessimism looms large in sustainability. Huw Morris reports

4th April 2024

Read more

Alex Veitch from the British Chambers of Commerce and IEMA’s Ben Goodwin discuss with Chris Seekings how to unlock the potential of UK businesses

4th April 2024

Read more

Regulatory gaps between the EU and UK are beginning to appear, warns Neil Howe in this edition’s environmental legislation round-up

4th April 2024

Read more

Five of the latest books on the environment and sustainability

3rd April 2024

Read more

Media enquires

Looking for an expert to speak at an event or comment on an item in the news?

Find an expert

IEMA Cookie Notice

Clicking the ‘Accept all’ button means you are accepting analytics and third-party cookies. Our website uses necessary cookies which are required in order to make our website work. In addition to these, we use analytics and third-party cookies to optimise site functionality and give you the best possible experience. To control which cookies are set, click ‘Settings’. To learn more about cookies, how we use them on our website and how to change your cookie settings please view our cookie policy.

Manage cookie settings

Our use of cookies

You can learn more detailed information in our cookie policy.

Some cookies are essential, but non-essential cookies help us to improve the experience on our site by providing insights into how the site is being used. To maintain privacy management, this relies on cookie identifiers. Resetting or deleting your browser cookies will reset these preferences.

Essential cookies

These are cookies that are required for the operation of our website. They include, for example, cookies that enable you to log into secure areas of our website.

Analytics cookies

These cookies allow us to recognise and count the number of visitors to our website and to see how visitors move around our website when they are using it. This helps us to improve the way our website works.

Advertising cookies

These cookies allow us to tailor advertising to you based on your interests. If you do not accept these cookies, you will still see adverts, but these will be more generic.

Save and close