Saturday, 4 October 2014

Power to the People?


  A decision to consider closure by the operator of Scotland’s largest power station tells us much about the way the so-called “National Grid” is designed to serve the needs of the big English cities, rather than the thinly populated “Celtic periphery”.
  Scottish Power, the operator of Longannet power station, has announced it will not be bidding to connect to the grid in 2018. The reason? Even though Scotland exports a large proportion of its electricity to the big centres of demand down south, it also pays the highest transmission fees. Consequently, Scotland suffers a double whammy – it loses the benefit of being able to profit from the export of a valuable 21st century resource. And Scottish consumers pay higher bills because they sit at the tail end of a network built to serve the needs of over-populated, over-built England.
  But as a story highlighted in the “Western Mail” last year shows, the same dynamic applies to Wales, too. For in October of last year, the Mule pointed out that Welsh consumers pay the highest electricity bills in the whole of the UK. Even higher than Scotland, in fact.
  This is despite the fact that Wales, much like its Celtic cousin up north, also exports electricity. But this simple fact however obscures a more complex picture than Scotland. Whereas history has bequeathed on our northern brethren a network that treats them as a discrete entity, in Wales the network splits our country in two. This split is readily acknowledged even by English companies with a major stake in Wales, but the consequence is that whereas North Wales is a net exporter of electricity - by a pretty comfy margin too - up until recently South Wales actually had to import electricity from England. Hence the higher bills.
  For Wales, much like Scotland, this has a number of consequences. In the first instance, Welsh consumers have less spending power because a greater proportion of income is eaten up by fuel bills. In Wales, a country that exports electricity, a staggering 41% of households are now classed as in fuel poverty. And of course high bills have consequences for business as well. As Miller Argent pointed out in their submission above, high electricity prices hold back the Welsh economy in other ways, as they affect Welsh competitiveness, particularly the manufacturing sector.
  Since Miller Argent’s submission, things have changed a little bit in South Wales. With the construction of the massive Pembroke 1 power station, South Wales is now a net exporter of electricity to England too. Yet as National Grid’s own tariff charges show, RWE, owners of the station, will be paying something on the order of £35 million a year to export all that electricity down the line to Gloucester. Because of the iniquitous way the Grid works, much of that cost will be shouldered by struggling Welsh families, who are effectively subsidising their wealthier neighbours next door through their higher electricity bills.

  Better Together, I hear you say?

  Of course, Devolution of power consents came under the purview of the Silk Commission, set up by the Tory Government to look at more powers for the Welsh. But as Gareth Clubb, Director of Friends of the Earth, pointed out in a post earlier this year, there was never really any intention to give Wales substantive powers over consenting for large power stations. Wales has always had a slightly unruly relationship with our bigger neighbour next door. We’re just too unreliable to be trusted to plug England’s yawning energy gap.

  As the Commission itself put it:

“Wales is a net exporter of electricity, and an energy strategy that focused on Wales would not perhaps fulfil the needs of the wider United Kingdom, and England in particular” (translation of Welsh language version of the Silk Commission Part II report, section 8.2.13).

  Say no more...

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