It’s electrifying! From deindustrialisation to reindustrialisation

Or as Make UK, a body admittedly a little more qualified, puts it, whilst hydrogen and carbon capture (CCS) will undoubtedly play a significant role in the process, “for the majority of businesses, electrification offers the most sensible and sustainable method of decarbonisation”. At least for now. 

So, what are the barriers to
electrification in the UK, specifically? The answer is simple: cost. Electricity is both significantly more expensive in the UK than in other European nations like France, Spain and Germany, and costs more than gas – a phenomenon known in industry as the ‘Spark Gap’. This is a generational issue: unlike our international competitors, our traditional
reliance on gas means that we have failed to invest in the infrastructure so desperately needed to support electrification and our wider net zero goals.
 
Some effort was made by the previous government to remedy this, with the introduction of the British Industry Supercharger (BIS) programme. However, whilst this included a 60 percent
reduction in network charges for energy-intensive users, it still pales in comparison to the electrification efforts of other countries: France and Germany, for example, have seen network costs reduced by 90 percent.

The truth is that it is still incredibly difficult for UK businesses to make a business case for electrification. Why would a company
invest in carbon-reducing technology when gas remains cheaper, or choose to manufacture in the UK when they could get the same product from other countries for a fraction of the price? Why, on top of the cost of electricity itself, would a company then choose to invest in retraining their employees?

Read the full article in DPA's December 2024 issue