The UK’s energy industry is fragmented and a ‘system architect’ is needed to inform technical decisions and take a holistic view of the energy system in order to secure the country’s future energy supply, experts are warning.

Now academics at Newcastle University are calling on the Government to create an independent, expert body to inform energy policy.

The recommendation is included in a briefing note on energy policy, being sent to relevant MPs and other organisations, outlining a number of concerns about the fundamental problems facing the UK’s energy market. These include: energy storage and distribution; energy pricing models; lack of competition; and water use in electricity generation.

Professor Phil Taylor, Director of the Newcastle University Institute for Sustainability, said: “Energy is a hot topic at the moment and the Government has made some positive steps to open up competition in the market, but much more work is required - and quickly. There’s an urgent need to reduce carbon emissions while protecting the UK’s future energy security. It’s vital that politicians move beyond short-term political soundbites and instead support those initiatives that could make a real and sustainable difference.

The University is calling on the Government to establish a group of experts that can take a long-term view about what is required and inform technical decisions and energy policy in a more effective manner than the current situation. For instance, debate among policymakers focuses almost exclusively on issues of affordability and emissions reductions, ignoring the vital issue of the energy sector’s use of water. This thinking risks locking the UK into a future in which water availability could put energy security at risk, and power stations could be forced to reduce production or even shut down if there isn’t sufficient water available to keep them safely operational.

But it’s about more than just creating a body of experts and then continuing as before. The Government needs to work with the energy industry to fundamentally change the way energy is priced. Although we must make sure people can afford to heat their homes, for the majority of us energy is actually too cheap – this is why we leave lights on, keep appliances running and use machines at peak times when energy costs more.

The current pricing model does not accurately reflect the high economic and environmental cost of generating, storing and distributing energy. In fact, because of the way energy is sold today it becomes cheaper the more we use. This is unsustainable. Instead, energy providers should be rewarded for providing tools and techniques that help customers use energy efficiently and cost-effectively. They also need to diversify the energy mix available to customers, so people can switch from gas to electric power and back again depending on what’s cheapest at any given time.

Policymakers and energy providers also need to do more to understand how and why customers use and generate energy so they can find ways to reduce demand on the network, especially at peak times. This means funding must be given to projects such as energy storage test beds and inducement trials, and the results used to inform policy decisions.

There are a range of serious challenges facing the energy market, and policymakers need to think seriously about the wide ranging and long lasting effects their decisions will have. Only by addressing some of these inconvenient truths and engaging with the academic and business communities to ensure decisions are based on evidence and not just rhetoric will the Government be able to provide a secure and sustainable energy future for the UK.”

 full version of the energy policy briefing note can be viewed on the University’s website.

published on: 7 May 2014