UK over-dependent on gas, says former advisor

January 21, 2006 - 0:0
LONDON (IRNA) -- Britain's energy market needs to be diversified to protect the country from instability in gas imports, a former advisor to Chancellor of the Exchequer Gordon Brown warned Friday.

Ed Balls, who has since become a Labor MP last year, suggested there should be incentives for the energy industry to invest in coal to prevent a second dash for gas and protect diversity of supply.

"We badly need the energy review to shift us in the direction of a better managed and long-term energy market," Balls said in reference to the government's review of energy policy, which starts on Monday.

"That means making diversity of supply an explicit goal of energy policy, alongside reducing climate change and protecting consumers," Brown's former adviser said in an interview with the Financial Times.

He warned against Britain becoming too dependent on gas imports and cited the recent row between Russia and the Ukraine, that affected supplies to Europe, as a potential risk.

His warnings over security of supply are in line with recent statements made by Energy Minister Malcolm Wicks, who has also said there will be a continuing role for coal in the UK - as long as its environmental impact can be managed.

Analysts have suggested that the government will use the upcoming review to build the case for the building of a new generation of nuclear reactors to replace the country's ageing nuclear plants and ensure the country's stations are not all gas-powered plants. But Balls warned that the review of energy policy must not become "only the nuclear review - it should be much broader than that."

He also suggested that it should signal a move away from a liberalized energy market.