The government’s energy strategy leaves key questions unanswered

Editorial: The strategy is at least evidence that the government is starting to design a complex plan for energy generation that will eventually produce minimal greenhouse gas emissions

No fewer than eight nuclear reactors are planned, at an unspecified cost (PA)

There is one thing that can fairly be said about the government’s energy strategy: that it will not reduce a single gas or electricity bill for many years to come.

The business secretary, Kwasi Kwarteng, has been wise not to pretend otherwise. Even so, he’s probably veering into the realms of fantasy when he claims that the strategy, such as it is, will make a difference in “three, four or five” years’ time.

The centrepiece of the strategy is a nuclear revolution. After decades of indecision, U-turns and failed projects, no fewer than eight nuclear reactors are planned, at an unspecified but enormous cost. This will merely raise, once again, some familiar questions, most of which are not addressed in detail within the strategy.

How much will they cost? How will the financial risks be shared, if at all, between the public sector and the private companies contracted to build and run the reactors? What returns will be offered to the investors? Which nations are banned from participating in the process – just China, as before, or others? What will be done with the toxic waste? Will planning laws be abrogated?

New questions arise, too. The invasion of Ukraine and the consequent occupation of Chernobyl remind us not only that nuclear plants can be subject to accidents, but how vulnerable they are to attack from hostile nations or terrorists. Germany, much maligned for running down its nuclear resources and switching to Russian gas, made the momentous decision to do so because of the Fukushima disaster.

Nuclear installations are mostly defenceless against both natural and manmade assault. Some of these same objections can be raised about the small modular nuclear reactors being designed by Rolls-Royce. Who wants to live next door to one of those?

There are other ambitious plans, too: vast offshore wind farms; green hydrogen for fuel; and renewed investment in North Sea oil and gas as a stopgap to help deal with the immediate crisis, which has been exacerbated by Mr Putin’s war. Fracking doesn’t get much of a look-in, though the government is trying to perform a slow-motion U-turn on its current policy. Like nuclear, fracking won’t make even a modest difference in bills until the end of the decade, and isn’t worth the emissions involved in blowing up parts of Lancashire.

All of which, curiously, leaves aside most of the green options that could start to ease energy costs for households and industry by the end of the year. Onshore wind, for example, now a tested and mature technology, is the cheapest source of energy and can be exploited in a matter of months.

The same goes for all the insulation measures that Britain’s solid but ageing housing stock will require in order to be fit for the next century. Fine Georgian terraces, Victorian and Edwardian villas, inter-war, mock Tudor, semi-detached, post-war estates... all of these were built in an age of cheap coal and gas, and with little attention given to their energy efficiency. They can all be uprated with an immediate effect on heating bills, but there are presently few incentives to plough money into such projects – even where households can afford it.

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Energy performance certificates for homes advertised for sale often tell a depressing story. Investment in insulation, solar panels and air pumps costs tens of thousands, but the annual savings made are in the hundreds of pounds – and you can’t take them with you when you move. It’s an obvious case of market failure, and one the energy strategy doesn’t recognise. The same arguments apply to the whole transport sector, where the cost of battery electric propulsion for the movement of either passengers or freight is still out of the practical reach of families and industry alike.

Still, it is something. The strategy is at least evidence that the government is starting to design a complex plan for energy generation that will eventually produce minimal greenhouse gas emissions. Nuclear, for example, which provides on average 20 per cent of the UK’s electricity, allows for baseload security of supply on days when the sun doesn’t shine and the wind doesn’t blow.

But the grand design for the future will be as much about economics as engineering, and that will require another strategy paper. Who pays and who benefits from the green and nuclear energy revolutions are sensitive political questions too. We’re waiting.