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I read many articles similar to this Guardian Piece arguing that we can’t afford the investments on our path to a clean power energy system.
There are fewer articles arguing the opposite; that we can’t afford NOT to invest in our transition to clean power. Let me make three points to make my case for this argument.
1) These articles (as per the Guardian piece) miss the point entirely, that our energy transmission and distribution networks need significant investment even if we were not transitioning to clean power. Much of our electricity network is 50+ years old, and has been under invested over past decades. Indeed, the recent fire at the Heathrow substation, that many rushed to blame on a network unable to cope with too much renewable energy, was in fact due to a 60 year old failing transformer. If you move into a house that has a 50 year old wiring system you would rewire it, and whilst you are at it, you’d update the technology to the latest available; safer circuit protection, a smart meter and ways to save energy and an EV charger. Maybe even a solar and battery system to enable flexibility and energy savings into the future. So, as we need to upgrade our under invested national energy system, it’s obvious that we future proof this, and turn it from a historical centralised energy system to a much more decentalised one able to be much more flexible, resilient and lays the path for energy cost savings for the consumer.
2) The arguments for too high an Investment, don’t differentiate between the required investments needing to be funded by the state versus from the private sector. The 7th Carbon Budget, which is based on objective evidence says that the investment now required to finish the job and fully electrify our energy system is £26bn per year between now and 2050. It goes on to say, which is the good news, that of this total, £22bn will come from the private sector, leaving ‘only’ £4bn per year needed from public funds. Such is the success our journey to decarbonise our energy system over the past 15 years (which is never credited in these more negative articles) with clean power technologies tumbling in cost over the past two decades, and making technologies like solar, battery storage systems and on/offshore wind make very good commercial sense.
3) The path to electrification is now unstoppable, and much more efficient than the fossil fuel system we are leaving behind (over a long transition period). The pace at which consumers, industrial users and manufacturers are now switching to electrified solutions e.g. EVs and electrical heating systems like heat pumps, or other renewable technologies (like hydrogen for industrial applications) is now finally accelerating at an unstoppable pace. It would therefore make no sense at all to power this increasingly electrified power demand, with fossil fuels! – Although that isn’t my main point.
These new electrified systems are also much more efficient than the inefficient fossil fuel technologies they are replacing. This means that savings from the newer more efficient systems are beginning to pay back. Indeed, also according to the 7th Carbon Budget the £26bn per year being invested in our clean power energy system is already, today, leading to operational savings of around £22 billion per year. A simple way to explain this efficiency saving is to consider solar panels on your roof supplying your own domestic energy needs. There are virtually no energy losses, as there would be in a fossil fuel system from extraction to burning and conversion to electricity, which is only around 20% efficient. So, the solar power is basically free. Just the investment needs paying off and the cost of that investment has reduced significantly (solar panels have dropped 90% over the last two decades). When you scale that up, the energy efficiency savings are enormous, and energy becomes virtually free once the investment is paid off (of course there are network and some operational and maintenance costs, but they are relatively low compared to extracting and converting fossil fuels).
In summary, we can’t afford to NOT keep investing and accelerate our path to clean power. The slower we go, the longer it takes to realise savings for consumers.
[ps: I chose to make the more commercial & technical arguments in this piece. Missing is of course the obvious need to accelerate climate action and that through this energy revolution, we have a very significant upside opportunity in terms of the economy & jobs, that we also leave behind if we slow this transition down]