Two-tier energy system ‘not on the cards’

A two-tier energy system, which sees poorer customers left without power, is “simply not on the cards”, the Energy and Climate Change Intelligence Unit (ECIU) has said.

There would be an “unprecedented political pushback” if richer households were allowed to pay extra for more reliable electricity supplies.

The think tank was responding to comments by Ofgem senior partner Andrew Wright, who was quoted in Telegraph saying richer households may be able to “pay for a higher level of reliability” in the future. He warned that poorer households could be left to “sit in the dark” due to intermittent renewable generation as “not everyone will be able to use as much as electricity as they want”.

“Despite having been made in a personal capacity at a conference more than two months ago, Andrew Wright’s comments have been used to mount an attack on renewable energy, one of the UK’s strongest industrial sectors,” said ECIU energy analyst Jonathan Marshall.

“The idea of two-tier networks for different households is simply not on the cards, and would face unprecedented political pushback if it got anywhere near to being implemented.”

Marshall said the costs of renewable energy have fallen “faster than anyone expected” and that onshore wind is now the cheapest form of generation, even when taking into account the cost of “filling in the gaps”. He added that the UK’s electricity system has “never been more flexible” and that storage and demand-side response are making it “cheaper and easier” to respond to changes in renewable output.

“Last week’s capacity market is clear evidence of this,” he added, “with batteries, demand-side measures and peaking gas plants the big winners.”