Increasing the UK’s extraction of fossil fuels, whether that is expanding North Sea production or using shale gas, would not reduce the pressure of high gas prices on UK consumers, according to the UK Climate Change Committee (CCC).
Speaking at meeting of the Parliamentary Renewables and Sustainability Group (Praseg), Climate Change Committee chair Lord Deben said “What we do in the North Sea will not affect the price of gas”. In fact, he said nothing the UK could do would affect the price of gas because it was in a global market – and it was “odd” to say that as the gas price increases we need more of it. In contrast, he said, “the only thing you can do is move as fast as possible to renewables”.
In a series of tweets CCC chief executive Chris Stark added, “Some have argued for an increase in UK-produced oil and gas as a response to the price spike. But even if we could boost UK production quickly, new production can’t be earmarked only for the UK. And prices are set internationally. UK production won’t move prices paid in the UK.”
Stark said, “In the recent past, Ministers have stepped away from policies to help to reduce our consumption of fossil fuels. Sadly, it has cost UK consumers dear.” He said consumers would have saved £1 billion on their energy bills this year – £40 per household – if rates of home insulation had continued at their 2012 level and if the zero-carbon homes standard had come into force in 2016, as planned – a point reiterated by Lord Deben to the Praseg audience.
Stark acknowledged that there were potential advantages of North Sea fossil fuel extraction: jobs; some insurance against high fossil fuel prices if windfall taxes on production are returned to consumers; reduced energy imports. But he said these advantages were “considerably less than they’ve been historically” and asked ministers to set a “high bar” on further licenses for extraction – not least because of the “signalling effect” in the UK and internationally.