The energy sector marketplace is an erratic and brutal one. Future energy prices are highly unpredictable, commodity shortages are likely, and no single technology can deliver all of our energy requirements. Our security, what we can afford and our commitment to reducing carbon emissions and tackling climate change require that we have a diverse mix of energy types. This means that those working in the energy marketplace have to make assumptions about future trends and outcomes.
Some types of energy are perceived as “good” (usually renewable energy, such as wind power, hydropower and solar power) and others as “bad” (usually coal, gas and nuclear energy). While there is no other option but to invest in renewable energy (and the sector is expanding), traditional sources of energy cannot be ignored.
The cost of fossil fuels is still comparatively low and the time when low-carbon options will reach parity is some way off. The question no one can answer is how can we offer the best option for the UK at the lowest price to the taxpayer, especially in such difficult economic times?/p>
07 March 2011