Increasing electricity imports from Europe puts Britain's supply at risk, think tank warns

 
Courtney Goldsmith
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The think tank has warned the UK is becoming too reliant on electricity imports (Source: Getty)

The UK is becoming overly dependent on electricity imports from Europe, a think tank has warned.

The Centre for Policy Studies (CPS) will today publish a report that argues Britain has begun importing an increasing amount of electricity from continental Europe. A projected 67 terawatt hours (TWh) will be shifted to the UK through undersea interconnectors by 2030, which is a tenfold increase from the 2012 figure.

In the 12 months to March 2017, the UK imported 17.22 TWh but only exported 2.78 TWh.

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The CPS argues the more reliant Britain becomes on energy imported from Europe, the more vulnerable the country becomes to disruptions in supply, sudden price spikes and a wider tightening of capacity, which pushes up prices.

Imported electricity also has an unfair competitive advantage as it is not subject to the UK's carbon price floor or transmission charges that British generators face - the CPS said Britain is "offshoring" its carbon emissions rather than cutting them.

Tony Lodge, research fellow at the CPS and lead author of the report, said:

At a time when spare electricity generating margins across Europe are falling, it does not make sense to build an infrastructure which risks making the UK over-dependent on imports.

It would make much more sense for the UK to build up a safe electricity supply surplus from generators in Britain on a fair and level playing field.

The CPS said the UK's energy policy must prioritise the building of new gas fired power plants to deliver energy security, and it also argued that the Competition and Markets Authority should investigate the role of interconnectors.

Andrew Perry, senior consultant at Oliver Wyman’s energy practice said that while the report made valid points, it did not take a "clear-eyed" view of how generation capacity will develop in the UK or European markets or how different solutions can work together.

"UK generation capacity may become an issue and there may be a case for arrangements to encourage new-build gas being reviewed, but to place the blame on interconnection is obfuscation and missing the bigger picture," he said, adding that interconnections benefit the system by allowing intermittent wind and solar power to behave more like firm capacity.

"Investment in gas generation costs money that will be added onto the bills of customers, whether through subsidies, such as the capacity market, or inflated market prices (for example, because we reduce available supply through interconnection). Therefore, rushing to overbuild capacity is not necessarily desirable and could result in stranded / under-used assets."

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