Urgently needed—an energy plan

Britain must not lose the global energy race. Time for a new strategy based on firm targets and governmental grip

September 13, 2023
We are relying on EDF and China General Nuclear Power for our new nuclear power station at Hinkley. Adrian Sherratt / Alamy Stock Photo
We are relying on EDF and China General Nuclear Power for our new nuclear power station at Hinkley. Adrian Sherratt / Alamy Stock Photo

My first job out of university was in the office of Denis Rooke, the genius chairman of British Gas in the 1970s and 1980s, who built the system which has enabled natural gas to constitute a dominant and reliable source of our primary energy to the present day. Another Rooke is urgently needed today, to build a nuclear and renewables system able to replace gas in the face of global warming.

Perhaps a closer parallel of the leader we need is Marcel Boiteux, the contemporary of Rooke’s who played a central role in building the French nuclear power industry, which provides an astonishing 70 per cent of France’s energy from a standardised fleet of 56 reactors. Boiteux died last week at the age of 101, having lived long enough to see nuclear power once again surge in popularity across the world, although his state company, EDF, has struggled with maintaining reactors and forging new designs. Dynamic global leadership in the industry now lies with the US, China, South Korea and Canada.

Britain is a leader in neither nuclear nor renewables. We are relying on EDF and China General Nuclear Power for our new nuclear power station at Hinkley, which is turning into one of the most expensive and complex in the world. EDF has yet to start construction on another agreed project at Sizewell, and there is no realistic programme for a fleet of further reactors to follow. As for wind power, Siemens and RWE of Germany and Vestas and Ørsted of Denmark are Europe’s industrial leaders, with US companies also dominating this market. Britain’s Rolls-Royce is pioneering Small Modular Reactors as a new nuclear concept, and these are supposedly quick and easy to construct, but none have yet been built nor a contract put in place.

Relying on international partners might not matter if we had a state energy plan worth the name. But where is it? A new organisation called Great British Nuclear was launched this July, and as yet has barely got a name plate in place. As for renewables, the latest government auction for offshore wind farms was held last week. It yielded precisely zero contracts, because none of the (mostly overseas) companies in the market were prepared to build new farms at the proposed subsidy level, given big increases in costs—reportedly as much as 40 per cent—due to acute inflation in the energy sector. So where does that leave government ambitions for trebling offshore wind supply by 2030 as part of achieving net zero by 2050?

Then there is the national grid, another triumph of British state planning and construction in decades past but now woefully short of capacity and holding back the development of renewables. National Grid, now a private company, published a “Delivering for 2035” document this May. But it isn’t an actual plan to deliver anything, so much as a set of demands for the government to reform planning and regulation. John Pettigrew, its chief executive, said plaintively at its launch that “incremental change will not be sufficient—we need a transformative approach.” But, again, where is it? The government’s latest policy and legal framework on energy infrastructure was put out to consultation in March, but there is still no action.

Labour is proposing another new planning and investment body, to be called Great British Energy. But its remit and funding are still unclear, and Rachel Reeves, Labour’s shadow chancellor, has announced fiscal rules which may make it hard to ramp up state investment resources fast. So GBE could become yet another body producing plans, dependent on the government and private companies to make anything of them. It could simply end up in competition with the Department for Energy Security and Net Zero (DESNZ) for setting policy. Calling an organisation Great doesn’t make it… great. The same goes for a country.

So what’s to be done? First, a single state body—and why not DESNZ, the department responsible?—needs to produce credible and clear 2050 targets for energy supply by sector, including goals for enhanced power transmission infrastructure, with milestone targets for each five years hence. It should put in place an accelerated planning system to deliver against these targets, and forge international agreements to help meet them.

Second, Great British Energy, Great British Nuclear, and the National Grid should be given specific delivery objectives, with GBE given responsibility for delivering targets on renewables. These bodies need to focus ruthlessly, like Marcel Boiteux and Denis Rooke, on cost-effective and standardised designs for infrastructure and the mechanisms of delivery, learning by rapid repetition.

Is this compatible with a patchwork of private companies and overseas state entities as the construction and delivery partners? Boiteux and Rooke, both of whom witnessed immense feats of strategic planning during the Second World War, would have thought that idea absurd. Any state worthy of the name has to be able to provide directly for energy supply, they would have said. Rooke’s last major battle, with Margaret Thatcher intent on gas privatisation, was to keep British Gas as a single integrated supply and distribution company. The truly great challenge of the next decade is for the state to achieve a net-zero energy transformation without wholesale nationalisation or exorbitant cost. It will be a very tough gig.