Energy security

DOI: https://doi.org/10.58248/PN676 

Overview

Over the course of 2022, household energy bills are expected to increase by almost 180% and businesses may see their bills double. This has been driven by increased demand for gas as the world emerges from COVID restrictions and the war in Ukraine, during which Russia has restricted exports of gas to Europe. The prospect of rising fuel poverty rates and gas shortages has brought energy security to the top of the political agenda.

Energy security risks go beyond high prices and fuel shortages. In the recent past, most energy security events have been failures of electricity networks, often due to storms. There have also been examples of customers not being able to access petrol and diesel due to distribution issues, such as a shortage of tanker drivers in September 2021. In the future, the transition of the energy system to meet the goal of net zero emissions is likely to change the energy security risks faced by the UK. As electricity generation continues to move from flexible gas turbines to variable renewables and non-flexible nuclear power, new operability challenges and threats such cyber-attacks will arise. The UK will also require new workforce skills, materials and investment to allow the net zero transition to progress. The effects of climate change, such as flooding and extreme temperatures, could also negatively affect the UK’s energy security.

A range of measures will be needed to maintain and improve the UK’s energy security through the net zero transition. Demand reduction, such as through household insulation, has been shown to be a fast, cheap and effective way of improving energy security by lowering overall energy demand. Increasing the amount of domestic energy generation can reduce the risk of energy failing to reach customers, either due to problems transporting it, or due to geopolitical tensions. As the energy transition progresses, new sources of flexible electricity generation will be needed to balance supply and demand, such as batteries, hydrogen, demand response or interconnection with other networks.

Key messages

• Definitions of energy security can include the availability of fuel, affordability, environmental and geopolitical acceptability, and accessibility of energy.
• Energy security risks include high energy prices, fuel shortages, equipment failures, the effects of climate change and net zero transition risks, such as a lack of investment or system operability challenges.
• Great Britain’s energy security processes and metrics focus on electricity generation, and the reliability of gas and electricity networks, ignoring the price of energy.
• Measures to improve energy security include demand reduction, energy storage, diversification of supply, energy market reform and interconnection, but will not provide short-term energy price relief.

Acknowledgments

POSTnotes are based on literature reviews and interviews with a range of stakeholders and are externally peer reviewed. POST would like to thank interviewees and peer reviewers for kindly giving up their time during the preparation of this briefing, including:

Members of the POST Board*

Peter Abson, National Grid Electricity Transmission

Keith Bell, University of Strathclyde*

Adam Berman, Energy UK*

Michael Bradshaw, Warwick Business School, University of Warwick*

Randolph Brazier, Energy Networks Association*

Timothy Chapelle, Energy Systems Catapult

Daniel Clelland, Energy Networks Association

Chloe Corbyn, Senedd Research, Welsh Parliament*

Emily Cox, University of Cardiff & University of Oxford*

Simon Dawes, Department for Business, Energy and Industrial Strategy*

Sam Fankhauser, Smith School of Enterprise and the Environment, University of Oxford

Antony Froggatt, Chatham House*

Jonny Gallagher, National Grid ESO*

Rose Galloway Green, National Infrastructure Commission

Mike Gaskill, Offshore Energies UK*

Euan Graham, E3G*

Matt Hinde, National Grid ESO

Stew Horne, Energy Saving Trust

Alexandra Howe, Department for Business, Energy and Industrial Strategy*

Tom Hughes, National Infrastructure Commission

Craig James, National Grid Gas Transmission*

Bengt Johansson, Lund University

Tomoyo Joshi, Osaka Gas UK

Eireann Leverett, Concinnity Risks

Tom Luff, Energy Systems Catapult

Jinmi Macaulay, National Grid Gas Transmission*

Alex Mason, Osaka Gas UK

Ross McGhin, National Grid Electricity Transmission

Yusuke Nakanaga, Osaka Gas UK

Rebecca Pickavance, Energy Saving Trust

Alasdair Reid, Scottish Parliament Information Centre*

Anupama Sen, Smith School of Enterprise and the Environment, University of Oxford

Richard Smith, Ofgem*

Aidan Stennett, Northern Ireland Assembly, Research and Information Service*

Paul Sullivan, National Grid Gas Transmission*

Luke Sweeney, National Infrastructure Commission

Ruth Townend, Chatham House

Beth Warnock, Energy Systems Catapult

Stewart Whyte, National Grid Electricity Transmission

*denotes people and organisations who acted as external reviewers of the briefing.