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UK 'could face power shortages' - Ofgem

Action needed to ensure Britain's energy supplies remain secure

Ofgem's Project Discovery conclusions confirm the need to act to deliver both security of supply and environmental objectives at affordable prices beyond the middle of this decade :

UK 'could face power shortages'
The UK could face power shortages in the years ahead, according to the energy regulator, Ofgem.

The regulator also warns that a significant number of consumers may not be able to afford the higher energy prices they will have to face.

Ofgem says there is "reasonable doubt" about whether the UK's energy market will be able to deliver sustainable (viable - JMS) supplies in the coming decade.

The industry needs £200bn of investment, Ofgem said.

“ Faced with unprecedented challenges we're looking at new solutions to protect security of supply ”
Alistair Buchanan, Ofgem chief executive
However, Ofgem believes energy companies may need stronger incentives before committing that level of funds.

In its report, Ofgem says the UK's open competitive energy market could fail to deliver secure, sustainable supplies in the coming decade.

Chief executive Alistair Buchanan told BBC News: "Faced with the unprecedented challenge of carbon prices, the unprecedented challenge of the credit crunch and the unprecedented challenge of maintaining international supplies, we're looking at new solutions to protect security of supply."

Among its range of solutions Ofgem suggests that companies should be required to deliver more generation capacity and gas storage.

It also suggests that the industry should revert to a form of centralised market control, which if adopted, would amount to the biggest shake up in the industry since privatisation.

Story from BBC NEWS: