Energy crisis has led UK to ‘foothills of recession’ says expert
As millions of households are facing fuel poverty as bills continue to soar, the Government has been urged to step in to help. And with Ofgem’s announcement that the price cap (maximum annual tariff) is expected to soar to £2,800, it is clear that urgent intervention is needed. One proposed measure has been to slap a windfall tax on companies like BP, which has seen sky-high profits while customers continue to fork out extra cash to heat their homes.
The tax on these profits could then be used to provide discounts to homes struggling to pay the bills.
But while the Government continues to mull over the measures like this, the British energy giant has taken matters into its own hands with an £18billion plan.
BP claims it will invest this cash into the UK’s energy system by 2030, spreading the money across a range of domestic projects.
This includes developing “lower emission oil and gas projects to support near term security of supply”, the company says.
These include several projects at its North Sea sites such as the Murlach, Kate and Mungo fields, with others in the area too.
BP has pledged to pump £18billion into Britain’s homegrown energy network
Energy bills have been soaring, pushing millions into fuel poverty
It also wants to Invest in exploration for oil and gas around its existing North Sea hubs.
But critics claim that investing in new gas and oil projects could go against the Government’s climate targets.
Campaign group Friends of the Earth UK (FoE) launched a petition to rally against the launching of 40 new coal, oil and gas extraction projects in the UK.
It came after an international group of experts from the UN’s IPCC issued a “code red” for humanity over the impact of climate change of the world does not act now.
FoE said: “The science is clear: to avoid climate breakdown, there must be no new fossil fuel extraction projects.
The energy price cap is expected to rise to £2,800 in October
“We can continue to extract oil and gas from existing projects as part of a just transition that protects the livelihoods of fossil fuel workers and consumers. But new projects cannot go ahead.”
The Government has a target of reaching net zero emissions by 2050, and opening up new oil and gas fields could be seen as putting that target in jeopardy.
BP announced in 2020 that it has the same 2050 target.
Now, the company is investing billions into renewable projects to help it reach those targets.
The company also plans to invest £1billion into electric vehicle (EV) charging over the next 10 years.
Another portion of the £18billon funding pot will be geared towards developing more offshore wind in the UK.
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BP want to invest in oil and gas exploration in the North Sea
The company is developing two 60-year offshore wind leases in the Irish Sea, with a combined potential generating capacity of 3GW.
It has another lease option with the potential generate a capacity 2.9GW off the east coast of Scotland.
These projects could generate enough energy to power over six million UK homes every year, according to the company.
It also plans to invest the funds into hydrogen infrastructure, with two large-scale production facilities at Teesdide.
These projects could produce up to 1.5GW of hydrogen by 2030 – 15 percent of the Government’s 10GW target by 2030.
Hydrogen is a renewable energy source which could in the future replace gas and shield consumers from rising bills further down the line.
The UK has pledged to reach net zero by 2050
Another renewable project BP is getting involved in is Carbon Capture and Storage (CCS).
CCS is when carbon dioxide (CO2) created from industrial processes is captured from the atmosphere and stored deep underground.
Its involvement in the East Coast Cluster (ECC) could see 50 percent of all UK industrial cluster CO2 emissions completely removed.
Another one of its CCS ventures, Net Zero Teesside Power (NZT Power), could see the world’s first commercial scale gas-fired power station with carbon capture -created.
The company claims it has the potential to deliver enough low carbon electricity to power around 1.3million homes.
BP tweeted: “The UK has a plan to boost long-term energy security and cut emissions. At BP, we’re all in.”
Bernard Looney, CEO of BP, said: “We’re backing Britain. It’s been our home for over 110 years, and we’ve been investing in North Sea oil and gas for more than 50 years.
“We’re fully committed to the UK’s energy transition – providing reliable home-grown energy and, at the same time, focusing on the drive to net zero.
“And we have ambitious plans to do more and to go faster.
“Our plans go beyond just infrastructure – they see us supporting the economy, skills development and job opportunities in the communities where we operate. We are all in.”