Britain is facing an energy crisis ahead of winter as it prepares to leave the EU without investing in its gas industry, having closed its coal power stations.
Over the course of last week, major policies affecting the UK’s gas and electricity supplies have been put into doubt, including fears that Brexit could impact Britain’s decision to give up its gas storage facilities.
“It is clear that the UK is reliant on flexible gas supply sources from the continent to support its market during periods of extreme weather conditions,” said Wood Mackenzie in a new report.
“This has come at a time when the UK is about to leave the EU, is closing down all of its coal-fired power plants and indigenous production is continuing to fall. This poses questions about future security of gas supply.”
The threat of a permanent closure of a scheme that prevents government making payments to power generators that have won contracts could lead to a total dismissal of coal and gas plants “which could create serious security-of-supply issues,” according to analysts at Jefferies.
Following the decision to turn its back on UK coal power plants, Britain has become increasingly reliant on energy imports and the lack of storage means supplies will dry out significantly fast during cold spells.
The decision to close the UK’s coal power plants also increases the country’s reliance on gas, which has seen a huge climb in price recently, which could force generators to return to the dwindling number of coal plants across Britain.
Earlier this year, the UK witnessed a surge in the use of coal as a result of higher gas prices, which forced utilities to look for cheaper alternatives and will continue through to the end of the year, according to analysts.