Britain’s increasingly reliance on electricity imported from Europe threatens energy security and will import carbon emissions, according to the new boss of the country’s biggest power station.
Will Gardiner, chief executive of Drax Group, said that the growing proportion of power forecast to come from interconnectors – physical links to transfer electricity across borders – would also fail to deliver the aims of the government’s industrial strategy.
“The hot topic at the moment is what we do about interconnectors,” said Gardiner, who wants to build a vast new gas power and battery storage plant at the company’s North Yorkshire coal and biomass power station.
The government expects imports to supply 22% of electricity by 2025, up from 6% last year.
A slew of new electricity links are under construction or planned for the next decade between the UK and France, Belgium, Denmark, Norway and Germany.
Three of those recently won contracts in a “capacity market” auction of government subsidies for supplying backup power in the winter of 2021-22.
That drove contract prices too low to encourage large new gas plants to be built and saw two of Drax’s new small gas power stations miss out on contracts.
Gardiner said the prices were a win for consumers, but added that interconnectors failed on other measures.
“Improved security of supply is one of the objectives of the auction, and I don’t think interconnectors do that,” he said. “Will they show up when they’re called? Maybe they will.”
While energy debates are currently dominated by cost, Gardiner said ministers’ priorities were likely to swing back to security of supply, driven by events such as the “beast from the east” cold weather, which put pressure on the country’s energy system.
Gardiner said that because the UK carbon price was higher than on the continent, more electricity links meant the UK would be importing emissions. Interconnectors would not help the government’s industrial strategy, he said.
“Are they supporting things that will bring jobs and technology to the UK that will ultimately be exportable? I don’t think interconnectors meet that test. I think a new gas plant using next-generation battery technology at Drax does.”
Drax wants the government to further “derate” interconnectors in the capacity market, which would see them receive lower financial rewards.
Gardiner, Drax’s former chief financial officer, took over the reins at the company in January when Dorothy Thompson stepped down after 12 years, having converted half of the plant to burning biomass instead of coal.
In an interview with the Guardian, he said it was increasingly clear that electricity supplies globally and in the UK would be decarbonised by wind and solar.
Both technologies had cut costs with “breathtaking” speed, he said, adding that the flexibility of biomass made it a natural partner for renewables.
However, he ruled out diversifying into large solar and wind projects, saying other firms were better equipped.
Gardiner said the UK’s other low-carbon option, nuclear power, was too expensive.
“I am not a fan of sweetheart deals, the government sitting down with Hitachi and writing them a cheque. That’s not good economics,” he said, referring to Hitachi’s chairman meeting with Theresa May earlier this month to discuss a financial support package to build a new nuclear plant.
Drax hopes its gas and battery plant project will get planning permission next autumn. But giving the green light on the investment will hinge on whether the company can secure a capacity market contract in an auction in winter 2019.
The firm building a new interconnector through the Channel tunnel rejected Drax’s criticism, noting that countries such as Norway, Denmark and France were largely powered by hydro, wind and nuclear respectively.
“We believe the argument that interconnectors import carbon emissions to be unfounded as the majority of interconnectors connect, or will connect, the UK to countries with a lower carbon intensity,” said Steven Moore, chief executive of ElecLink.
