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Cutting the Gordian Knot: Recalibrating the UK’s Energy Transition and Security Principles

Insight

Published by Oxford Business Law Blog

May 16, 2024
Insight

Published by Oxford Business Law Blog

May 16, 2024

‘Energy security and net zero are two sides of the same coin.’ This is the opening line of the UK government’s ‘Net Zero Growth Plan’, published in March 2023, and leaves no doubt as to the government’s perception of the interplay between energy security and energy transition. Declining North Sea reserves, energy majors with interests in the UK divesting (in no small part, as a response to the target of net zero by 2050), and geopolitically precipitated disruptions in the global traditional energy supply chains, inter alia, provide an important context to situate the foregoing twin aims. The urgency for an adaptable system is felt and reasonable, but is the framing of the discussion—which will orient the analysis and animate policy prescriptions—correct?

The International Energy Agency (‘IEA’) defines energy security as ‘the uninterrupted availability of energy sources at an affordable price.’ We conceptualise this definition in two limbs: uninterrupted availability as ‘Limb I (Sustainability)’ and affordable prices as ‘Limb II (Affordability)’. However, in many industry and policy conversations about the UK’s energy ecosystem, energy independence is often included too (we call this ‘Limb III (Independence)’). In the UK, there is a clear and conscious decision to marry the concepts of energy security and energy independence. Consequently, the full construct of our conceptual framework for understanding the UK’s approach to energy security includes all three limbs (‘Energy Security’).

The UK needs to recalibrate its approach to Energy Security by (i) deconstructing its limbs, (ii) accepting that its constituent elements can be incompatible, and (iii) creating a coherent but malleable hierarchy that allows for balancing and trade-offs. This article written by Miguel Colebrook and Iona Gilby* argues, using the grid as a working example, that a refreshed framework for understanding energy security, which prioritises investment in domestic infrastructure and secure international partnerships and incentivises private investment, will balance the competing aims of Energy Security while streamlining the UK’s approach to the energy transition.

Read the full article on the Oxford Business Law Blog.

 

*Iona Gilby is a trainee solicitor in the London office.

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This information is provided by Vinson & Elkins LLP for educational and informational purposes only and is not intended, nor should it be construed, as legal advice.