Ramping up production from the UK’s oil and gas fields in the North Sea could help ease the pain of high fuel prices in the short term but should not be seen as a long-term solution to Britain’s energy woes, experts have warned.
Lord Adair Turner, former CBI chief and former chair of the Committee on Climate Change, now chair of the Energy Transitions Commission thinktank, said the prime minister’s plan to produce more oil and gas now marked a sensible move, but he cautioned against those who saw a continued future in increased production.
“You have to distinguish between the short term – more gas from existing fields – and the long term,” said Turner. “You would have to be a very furious climate campaigner to say in the middle of a war you could not take measures like that.
“So we will probably have to take these short-term measures, like squeezing more from existing fields or importing more LNG [liquefied natural gas, by tanker], but fundamentally we want no new oil and gas [exploration] from the North Sea. The future of the North Sea should be windmills, not oil and gas.”
The returns from a push to expand production were likely to be limited, and so the focus should also be on renewable energy, added Bob Ward, policy director of the Grantham Research Institute on Climate Change at the London School of Economics.
“The UK is already committed to maximum economic recovery of oil and gas from the North Sea, but it is a mature basin with declining production, which is why the UK currently has to import about half of the natural gas that it consumes,” he said.
“We can see from history that the price of natural gas and oil is volatile, so the only way to prevent future crises is for the UK to cut its dependence on fossil fuels by deploying alternatives to fossil fuels. To reach net zero, these alternatives need to be clean.”
New licensing for North Sea oil and gas fields, which the government is also pursuing, would not produce any more fuel for decades, the Committee on Climate Change warned recently, so would be of no value in increasing production for the current crisis and would only leave stranded assets for the future. The CCC said it “favoured” an end to new licences but barring the government from granting licences was beyond its remit.
Some commentators, particularly some on the right of the Tory party, have also called for more fracking as a solution to high energy prices. However, even if the local objections to fracking could be overcome, it would take years to produce any gas in the UK. Modern fracking techniques were first tried in the UK over a decade ago by Cuadrilla, but it was soon forced to stop owing to earth tremors.
The Department for Business, Energy and Industrial Strategy has said no fracking could be resumed unless this issue was resolved. A spokesperson said: “The UK has no issue with gas supply, and unlike other countries in Europe, the UK is in no way dependent on Russian gas, with imports making up just 4% of demand.
“Fracking would have no effect on domestic energy prices in the near term. To boost energy security, we need to move away from expensive fossil fuels and generate more cheap, clean and secure power in the UK.”
Fracking would also require the industrialisation of swathes of the UK countryside. Rob Gross, director of the UK Energy Research Centre, said: “As an immediate response to events in Ukraine, fracking cannot provide a solution because it will take several years for prospective sites to become operational.
“In the longer term, fracking could improve our energy independence but that would not change the fact that the price of gas is set on international markets.”
If the UK wants to stop importing gas by next winter, that would be theoretically possible if every home were made energy efficient, according to calculations by Jan Rosenow, director of the Regulatory Assistance Project. He said: “We import about 150 TWh of gas for home heating every year. None of this would be needed if we insulated our homes and switched to heat pumps.
“We could save more gas than we import for heating with existing technologies. What is needed is the government to step up its policies now to roll out insulation and deploy heat pumps as quickly as possible.”
Rebecca Newsom, head of politics for Greenpeace UK, also warned against cutting government support for renewable energy in an effort to reduce bills, pointing out that this had backfired in the past because the levies funded insulation and other efficiency and low-carbon measures that were abandoned.
“We have already seen what happens when, in David Cameron’s infamous words, ministers ‘cut the green crap’ – UK energy bills are now £2.5bn higher thanks to that. Our gas-guzzling homes are funding Putin’s war, hurting our pockets as gas prices soar and wrecking the climate,” she warned.
“This is the price we pay for decades of government failure to end our dependence on fossil fuels. Our best hope for a safer, healthier, peaceful future is in moving away from oil and gas as quickly as possible and investing in clean energy and warmer homes.”
