Professor Barry McMullin:

First, because I am an engineer, I will have to make an engineering point. There is a significant distinction between the risk factors regarding the supply of natural gas and the risk factors regarding being able to maintain our electricity supply. What has caused very significant concern of the risk of blackouts in recent years, and this will probably continue for at least the next two or three years, is not actually threats to the supply of natural gas but the available generation capacity for converting, among other things, natural gas to electricity. We simply have not had enough generating capacity for a situation where low availability of renewables, which of course happens from time to time, coincides with high demand.

It is not that there is not enough gas available but that there is not enough plant available to turn that gas into electricity on demand. That is a genuine concern. Measures are being taken. There are many complicated reasons the shortfall in generating capacity arose. It should not have arisen but it is being actively mitigated. That involves building or deploying new gas-fired generation plant, which sounds counterintuitive given our climate objectives. The way of potentially squaring that circle is that, though we build new generation plant, the intention is it will run less of the time and burn less fuel. There are engineering technicalities to that. We are shifting to a different style of plant that is not as efficient as a conventional generating plant. That is working in the opposite direction and that is a problem. The strategic trajectory has to be to develop other ways of meeting our firm electricity demands other than from natural gas when there is no wind blowing or whatever. That is a bigger discussion. I will be happy to comment on that in more detail.

Risk analysis is a hugely subjective field so I will not pretend I can present a scientific balance of risks, but the threat of blackouts is not currently arising from a shortage of natural gas. I would argue that, strategically, the biggest risk to foreign direct investment and domestic investment is availability of adequate decarbonised energy. All of these economic activities are more or less intensive and, where feasible, we should target foreign direct investment that is less energy intensive. However, all economic activity involves energy, so the future of maintaining, never mind growing, economic activity relies on decarbonising our energy. The biggest risk factor in maintaining that activity is not decarbonising fast enough.