Move away from North Sea oil, renewables industry tells Government

The UK renewable energy sector has spoken out about the need to move away from fossil fuels after several senior politicians promised to prop up the struggling oil industry on Wednesday.

The Renewable Energy Association says the Government must shift its focus away from the UK oil and gas sector, which lost £5.3bn in 2014

The Renewable Energy Association says the Government must shift its focus away from the UK oil and gas sector, which lost £5.3bn in 2014

Chancellor George Osborne and Energy Secretary Ed Davey are among those who have pledged their support to the sector, which lost £5.3bn in 2014. The plunge in oil prices has already inflicted a heavy toll, with 1,500 North Sea workers being laid off and tax recepits plunging.

Wednesday saw the first report from the Government-funded Oil and Gas Authority, which pointed out ways in which the sector can mitigate the impact of falling oil prices. It suggested that oil companies had to improve their operating efficiency by 30-40%, and promised to "help operating companies revitalise exploration activity".

Commenting on the report, Davey said: "The North Sea is still vital for boosting our energy security. It's a simple choice of utilising home-grown oil and gas, or relying more and more on gas from Russia and oil from the Middle East."

Fossil folly

After his tax cuts in the Autumn Statement, Chancellor George Osborne vowed to take further action to support North Sea drilling. He said: "We've got record investment in the North Sea and there's a lot of oil still in there.

"We want to continue to maximise investment in the North Sea to make sure it continues to provide jobs and economic benefits to the whole of the UK.  I've already cut taxes in the North Sea and we're now looking at what more we can do to work with industry to support investment in this important sector."

However, the Renewable Energy Association (REA) has criticised this support from Government.

REA head of external affairs James Court told edie: "The constant oil price fluctuations, swinging from bad for consumers to bad for industry, whilst always being bad for the environment, highlights the need for us to move away from fossil fuels.

"Renewable technologies offer long term stability, more UK jobs and less dependence on imports whilst helping the UK meet the carbon targets all three major UK parties support."

Mounting evidence

Indeed, Osborne's focus on jobs may be overstated, given a recent report from the UK Energy Research Centre (UKERC) which said that investment in renewables and energy efficiency can create up to 10 times as many jobs on aggregate, as investment in fossil fuels. 

Osborne's claims about resiliency are also undermined by a January report from Renewable UK which found that boosting wind power generation would make the UK's energy supply more resilient and consistent by removing the costs of importation and the volatility of price fluctuations.

The untapped reserves of oil in the North Sea could even be a blessing in disguise, according to the UCL Institute for Sustainable Resources. In January, the institute revealed that the majority of the world's fossil fuels must not be burned if we are to stay within the 2°C global warming target. Specifically, around 33% of the world's oil reserves (260,000 barrels) must go unused.

The renewables industry has been widely outspoken about the continuing Government support for fossil fuels to the detriment of clean energy. The International Energy Agency revealed in November that fossil fuel subsidies totalled $550bn in 2013 - more than four-times those for renewables - and are holding back investments in efficiency and renewable energy.

Brad Allen


ed davey | fossil fuels | gas | renewables | Subsidies


Energy efficiency & low-carbon
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