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Wednesday 19 June 2024
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Letters / Who pays for decarbonising fossil fuels

Thank you for your informative article about the oil and gas (O&G) industry’s response to the grid link consultation.

Oil companies stress emissions aim in response to interconnector consultation

Clearly, they are manoeuvring to obtain public subsidy for decarbonising fossil fuel production. Replacing existing, gas-fired power with renewable energy will be very expensive, indeed.

Ofgem has accepted O&G industry decarbonisation as an argument for installing a grid link. It cannot be achieved without one. However, there is no word of any contribution towards the cost, as would normally apply to network reinforcements necessitated by new supplies.

The answer to the question of who should pay for O&G industry decarbonisation is obvious – the O&G industry, of course! Who else?


However, their consultation responses suggest they wish to dictate the price of their co-operation. Consumers will foot the bill for the rest. Oil and Gas UK stated:

“Connecting oil and gas facilities to the main transmission network will only be economic if the conditions are right, in terms of network charges, electricity prices and reliability” (my emphasis).

They continued, “…a single cable (grid link) may require backup solutions for oil and gas infrastructure…” and ominously, “the option of a dual cable specification should be retained…”.

Yes. They want a second cable. Perhaps, they will volunteer to pay for it? Alternatively, they will demand a much larger backup power provision, around 300MW, costing perhaps, £300 million. No. It wouldn’t be “economic” for them to pay for that either.

Yet another problem is “the impact of levies on end users…(from)… previous rounds of renewables projects, wider energy efficiency obligations on suppliers, and the application of other network charges to potential offshore electricity users.”

This means that, unlike us lower caste consumers, they don’t expect to pay for existing renewable energy subsidies; initiatives to relieve fuel poverty; or extra network charges associated with renewable energy, e.g. subsea cable transmission links. We will pay for all that, and to subsidise their supplies, too.

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Notwithstanding their ‘net zero’ throat-clearing, they don’t sound at all enthusiastic. The cost of their participation will be colossal. Unless consumers pay they will walk away. Doubtless, our craven electricity regulator, Ofgem, openly putting decarbonisation above consumer interests, will cave in to their demands.

Thus, colossal sums will be paid to subsidise fossil fuel production. Oil and gas will be artificially cheaper and electricity dearer as a result.

I explained this to Ofgem in my submission and they have heard exactly the same from the O&G industry. Yet they have approved the project, irrespective of the cost to consumers.

The same will apply to the SIC’s “energy hub”, only, 22 times over. Surely, such unimaginable folly cannot prevail.

That Shetland’s pristine environment, lauded as a Unesco Global Geopark, will be devastated for ‘net zero’ ideology, resulting in massive fossil fuel subsidy flies in the face of common sense and indeed, environmental logic.

Meanwhile, families in fuel poverty will face ever-rising electricity bills, merely to ease the financial discomfiture of Big Oil’s climate makeover.

John Tulloch

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