The energy sector here in the United Kingdom has long been riddled with problems. For the past five years, the Government has been taking active steps in order to make sure that the problems which are troubling the energy market are reduced as much as possible. Now, it is expected that within the next few years, the UK will enter a stage in which the overall demand of electrical energy is expected to rise higher than the overall supply. As a result of this, the Government has been trying to diversify the energy portfolio by providing subsidies for numerous other sectors, such as the renewable energy industry. Wind and solar power have become hugely popular in the United Kingdom, and it is expected that by the year 2015, almost one in ten homes in the UK is going to be powered by renewable energy.
The question remains however, is renewable energy the viable solution to the energy sector in the long run? At present, solar and wind energy are the two main components that make up the renewables sector, and both of these are considered to be too highly expensive and inefficient to be produced on a massive scale. Even though there are numerous different companies that are establishing wind farms both off shore and on shore, wind power has yet to be seriously taken up. One of the reasons for it is probably because the Government is quite against the use of wind power on a massive scale at present. Numerous top level companies such as General Electric and Mitsubishi have expressed interest in constructing manufacturing plants in the United Kingdom which will further help develop the wind industry, as local in house production of wind turbines can be initiated.
However, all of these companies are currently dallying on their decisions to start construction on their manufacturing plants because the government has called for a review of the energy bill. The energy bill has been the point of much debate between politicians in the UK. Only recently, around 100 Tory MPs signed a statement that stated they were all against the further development of the wind energy industry, but on the other hand, a lot of politicians are voicing their support for the wind energy industry, stating that in the long run, offshore and on shore wind farms could prove to be the major catalyst in the generation of electricity.
Even though the review of the energy bill is likely to take a bit of time, any changes that are brought about at the last minute are likely to cause investors to move away. Revision to the already established policies will also mean that investors won’t be looking to make any sort of investment until firmer assurances have been provided by the government to the companies. On the part of the Government, it has been trying hard to come up with solutions that will help in the long run. Only recently, the Government, along with a Chinese consortium as well as the French powerhouse EDF, announced that they had signed a deal to construct a new uranium fueled water cooled fission reactor at Hinkley Point C in Somerset. These twin reactors are likely to be constructed at a cost of 14 billion GBP, and are expected to be completed around 2020. Each reactor will be capable of producing around 1.6 gigawatt of electricity, allowing them to provide around 7 percent of the total electricity of the United Kingdom.
As good as this sounds on paper, there are several problems associated with this project. First of all, the Government has decided to adopt a ‘European Pressurized Water Reactor’ design, which basically means that the government is essentially selecting an older technology that is likely to go out of date within a relatively short period of time. For such a big investment, this can be troublesome. The new reactors will be powered by uranium fuel, which is not only expensive, but will also significantly deplete reserves. A more viable solution would have been to opt for thorium fuel powered reactors, as thorium has become a very popular source of fuel. Moreover, the biggest factor here is that thorium is much cheaper and a lot more readily available.
On the other hand, the plight of the commoner still goes unanswered. Electricity bills have been rising steadily over the past few years, and now they have become one of the top economic issues voters have become concerned with. Ed Miliband, the current leader of the Labour Party, stated that if he was elected in 2015, he would freeze the prices of electricity for the next 20 months and promote more competition in the industry. Only recently, British Gas made an announcement that it is going to bring about an increase of 10 percent in all of its bills. Then another energy company, SSE, also made an announcement that all of its customers will have to pay 7 percent more for gas and electricity. nPower also announced the highest price rise from all the ‘Big Six’ energy producing companies in the market – an increase of 10.4 percent. However, the issues go much deeper than the price increases, as mentioned above.
In order to remove its reliance from coal and gas powered stations, the government is trying its hardest to promote solar energy as well. In the recent cuts, it was announced by David Cameron that solar and wind will not come under review, and the Government has also lent its support to the ‘One Million Rooftops’ campaign, which aims to install one million solar PV systems on rooftops all throughout the UK by the year 2015. Even though solar powered electrical energy is still a long way from being commercially produced for the larger community, such initiatives clearly show that the government is trying to make an effort to reduce the impending problems, but still has a long way to go to ensure UK consumres recieve a fairer deal and start to feel the benefit of reduced energy costs.