The rest of the UK needs Scotland to help keep the lights on and energy bills down, a new report claims.
The Scottish Government has attacked Westminster’s energy policy, claiming the uncertainty caused by successive governments to properly prioritise security of supply has led to a much reduced electricity margin which could lead to higher bills.
The latest forecast from Ofgem revealed the UK’s safety margin between electricity supply and demand could fall to as low as 2% by 2015/16.
“The consequences of this are grave, with upward pressure on consumer bills, extra costs for business and a deterrent effect on inward investment”, the report claims.
The equivalent margin for Scotland however will be around 20%, it added.
The Scottish Government says Scotland, which has exported more than a quarter of its electricity to England in recent years, has become the UK’s “energy reserve”. It also believes the nation can help the rest of the UK in meeting its climate change and renewable energy targets.
The report states: “As a substantial supplier to the rest of the UK, an independent Scotland will require a far greater degree of oversight of the market arrangements for energy and firmer safeguards over Scottish energy security. The policies of the UK Government have brought us to point where the risk of blackouts is the highest for a generation.”
Scotland’s Energy Minister Fergus Ewing added: “The laws of supply and demand and the cost of bringing more expensive power plants onto the grid to meet peak demand will drive up household energy bills the closer the UK gets to having no spare generation capacity.”
The report also claims National Grid has warned about planned new power stations being cut by more than half due to lack of investment clarity from the UK.
Mr Ewing went on: “It’s time for the UK to sort out their energy policy, stop driving away investment and instead start addressing its security of supply problems instead of making them worse.”
DECC said the UK has a broad mix of energy sources, which means that if there is a shortage of any single energy source “then other energy sources can fill the gap”. It claims Government analysis shows if Scotland becomes independent, “there would be only minimal impact on the continuing UK and no greater risk to our energy security”.
Energy Secretary Ed Davey added: “The UK’s energy security is among the best in the world, backed by a large consumer and tax base that can afford to support our world-leading energy industries and make us such an attractive place to invest.
“The broad shoulders of the United Kingdom is unlocking the power of Scotland to take its place as one of the world’s great energy hubs – generating energy and generating jobs.”