Experts have put the UK on a “watch list” over concerns about the security and affordability of its energy supplies, despite scoring highly in global rankings.
The UK is only one of three countries to achieve an AAA rating in a report on 129 countries from the World Energy Council and management consultants Oliver Wyman for the security, affordability and sustainability of energy supplies.
But it is experiencing a downward slide in two out of the three areas the World Energy Council assesses in its latest World Energy Trilemma report, which looks at how countries balance having secure, equitable and clean energy resources.
The report finds that, worldwide, energy systems are being put under increasing strain and governments are limiting their spending, putting in jeopardy the £30 trillion the World Energy Council said is needed over the next 20 years for the energy sector.
There is enough money from the private sector available to meet the demand, if the right policies are in place, the report suggests.
But governments need to give investors certainty and help to pour trillions of pounds into the radically changed energy system required to ensure everyone has access to affordable energy and to tackle climate change.
Overall the UK comes fourth in the world ranking, behind Switzerland, Sweden and Norway. Zimbabwe comes bottom of the list. The UK is in the top 10 for its energy security, but not in the top 10 for either sustainability or affordability of supplies.
And it has been placed on “negative watch” along with Japan, Germany and Italy.
The executive chairwoman of the World Energy Trilemma work, Joan MacNaughton, said: “One of the things that’s important is the trend. Over the last three years there has been a downward trend in the performance of the UK.
“In particular, its energy security is down, it’s still just in the top 10, but it’s come down quite a lot since 2012. Affordability has worsened significantly.
“Clearly there are issues that the UK would want to look at, but it is one of only three countries that get a AAA rating so it’s still doing very well.”
Domestic oil and gas production is declining, and while the country was looking at shale oil and gas sources, it was not clear how much there was, if public acceptance for fracking could be secured, and the costs of getting it out of the ground, she said.
The country was also facing issues including the closure of ageing coal and nuclear plants, a delay before new nuclear reactors would come on line and poor economics for new gas plants, while investors were waiting to see how “radical” interventions in the energy market would be implemented.
And she said: “Even countries with strong incumbent energy infrastructure are having a hard time balancing their energy trilemma, while many others are still struggling to meet their population’s basic energy needs.
“The persistent gap and future barriers to energy funding will only exacerbate an already fragile global energy system. Clearly countries must act now to reverse this oncoming storm: there is no time for complacency.”
A spokesman for the Department of Energy and Climate Change said: “We have taken action to ensure our energy security and turn around a legacy of under-investment in our energy sector, attracting £45 billion worth of investment as part of our plan to keep the lights on and provide more clean, home grown energy.
“Consumer bills are lower than if we took no action and our energy market reforms provide certainty for investors.”
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