Liz Truss Is "Shooting Herself In The Foot" With Short-Term Fossil Fuel Focus, Energy Experts Say
Liz Truss is expected to announce a major new round of oil and gas licences (Alamy)
5 min read
Energy experts have warned that Liz Truss's major push on fossil fuel projects, including North Sea oil and gas and fracking, will fail to improve the UK's energy supplies during the winter months.
They also expressed concern that her focus on unproven nuclear technology to steady supplies in the longer term was coming at the expense of short-term gains from renewable energy sources.
Truss has already announced that household energy bills will be capped at £2,500 for the next two years in response to soaring global wholesale energy prices.
She has also criticised "decades of short-term thinking on energy" and vowed to take immediate action to improve the diversity of the UK's energy supplies in order to bolster its security. This is set to include a significant new oil and gas licensing round – the first since 2020 – which could see over 100 new exploration projects approved in the North Sea in an effort to boost domestic production.
Truss also lifted the three-year ban on the controversial practice of fracking, and recommited herself to the government's ambitions to increase the UK's nuclear energy sector, including a focus on new Small Modular Reactors (SMR) being produced in the UK.
UK-based Rolls Royce have already submitted plans for initial approval for their SMR technology, which provides nuclear energy from sites which are significantly smaller, cheaper and quicker to build than traditional reactors.
Shortly before leaving office, former prime minister Boris Johnson pledged a further £700 million to the Sizewell C nuclear power project, bemoaning prior governments' "paralysis" on nuclear energy, not expected to begin producing electricity until the 2030s. It is hoped Truss's renewed focus on SMRs will bring forward the availability of nuclear energy, although that is still not expected before the end of the decade.
Energy experts worry that the plans have reduced focus on shorter-term solutions, such as better insulating homes, meaning households could still face issues with energy supplies in the coming winter months.
Tom Sasse, an associate director at the Institute for Government, said Truss was "shooting herself in the foot" by not prioritising investment in renewable energy sources that could deliver new energy supplies much more quickly.
"Liz Truss is right to be concerned about security of supply. But if that's the aim she is shooting herself in the foot by ignoring the options that would make a difference most quickly, like solar and onshore wind. North Sea oil and gas will take years to ramp up, while fracking will get snared in legal challenges," he told PoliticsHome.
"Continuing her predecessor's focus on nuclear, including new SMRs, is sensible but also, as history shows, unlikely to be a quick fix.
"Her plan also looks very lop-sided by refusing to look at demand. She needs a demand taskforce looking at things like home insulation, boiler efficiency, thermostats, measures which could cut gas demand by as much as a fifth by next winter."
While government's support for SMRs has been welcomed by the energy industry, some experts have expressed concerns that a focus on the new technology, which has not yet been approved, should not be prioritised over reducing energy demand among consumers.
"SMRs are not a near-term solution, but they could be a useful addition to our energy system in the medium-to-long term," Matt Rooney, Head of Policy at the Institution of Mechanical Engineers, said.
"This is because they can provide on-demand electricity that would complement the variability of solar and wind.
"There are not many technical solutions that will be able to reduce consumer energy bills in time for this winter. Government interventions and market reform are faster to implement.
"But if high energy costs persist for months or into next winter, then insulation and energy efficiency measures will be very important to reduce costs for homes and businesses. Reducing demand is easier in the short term than boosting supply."
Truss's plans to boost North Sea oil and gas supplies will be supported by newly appointed Business Secretary Jacob Rees Mogg, who has previously called for "every last drop" of oil to be extracted from the North Sea.
But one senior geologist working in the sector told PoliticsHome that producing a meaningful increase in supply of oil and gas could still take several years.
"Let's say you are awarded a licence next year, with a discovery already drilled, the quickest you would be able to get a project on stream would be two years. And that is making a lot of ambitious assumptions," they said.
"For anything less mature you would add years at a time, easily."
They added that while the new push for fracking was "encouraging", they claimed it was "likely too late" to have any impact on the immediate energy supply crisis.
"Shale gas in the UK is so immature, with a lot of remaining uncertainty on how viable it would be, but the previous ban has delayed the research into this uncertainty by years."
Truss's liberalisation of fracking has been heavily criticised by Lord Deben, her most senior climate change adviser, who said ministers needed to "look at the facts" around the environmental impact of the plans.
Dr Nina Skorupska, chief executive of the Association for Renewable Energy and Clean Technology, said the current plans "beggar's belief".
"I fear that, in a few years' time, we will look back at recent announcements with a great deal of regret," she told PoliticsHome.
"It beggar's belief that even though the current energy crisis is being caused by price volatile fossil fuels, the government has doubled down on oil and gas production.
"These decisions come just less than a year after the UK hosted COP26, and questions the government's commitment to Net Zero. Economic growth and tackling climate change go hand-in-hand – it is not an either/or."
"The government must now focus their plan beyond the winter to help deliver the real solutions to this crisis. A national scale energy efficiency programme, and helping homes and businesses transition to renewable alternatives."
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