“Powering Backwards: UK’s Energy Competitiveness Deficit”

As chair of EDF, Sir Alex Chisholm has a unique perspective on the UK’s energy landscape. His comments on the competitiveness deficit in UK energy costs are striking not only for their starkness but also because they come from a sector often at odds with government policies.

The numbers tell a troubling story: gas and electricity costs for businesses have increased by 25% since February, largely due to conflict in the Middle East. This has led the Confederation of British Industry to warn that persistently high energy prices threaten the UK’s global competitiveness, effectively putting the brakes on growth ambitions. Chisholm is correct when he says this is a “real call to action” for the government.

But what drives this deficit? It’s not just expensive raw materials or international market fluctuations. According to Chisholm, the problem lies in the UK’s regulatory environment, specifically its over-protective approach to environmental protection. He cites Hinkley Point C as an example, where EDF spent almost a billion pounds on fish-protection measures that he believes “make no sense.”

The Fingleton Review of nuclear regulations, adopted by the government earlier this year, aimed to strike a more balanced approach between environmental protection and regulatory efficiency. However, Chisholm argues that current rules lead people to over-regulate unnecessarily, causing more harm than good.

Chisholm’s comments raise questions about whether his concerns are as much about regulatory reform as they are about the UK’s energy competitiveness deficit. The 55,000-page development consent order required for Hinkley Point C is a case in point – an example of how bureaucratic overreach can stifle innovation.

While Chisholm respects environmental standards and nuclear safety, he is right to question whether the current approach is proportionate. After all, as Fingleton noted, Hinkley Point C already has more fish-protection measures than any other power station in the world. This isn’t just about cutting costs – it’s about streamlining regulations that are stifling investment.

Nuclear power is a key part of Chisholm’s vision for the UK’s energy future, both for energy security and supply. EDF’s two new nuclear facilities in the UK, Hinkley Point C and Sizewell C, are crucial to this plan. However, these projects face well-documented challenges: delays, cost overruns, and regulatory hurdles.

The UK needs to reduce its reliance on fossil fuels, but it also needs to get its own house in order – specifically, its regulatory framework. Chisholm is right to call out the UK’s competitiveness deficit in energy costs, but he’s also highlighting a deeper issue: the need for regulatory reform. If the government truly wants to “power” the UK forward, it needs to take a hard look at its own policies and procedures – not just the energy sector itself.

As Chisholm puts it, “The U.K. has a competitiveness deficit now in its energy costs—that is a real call to action.” It’s time for the government to listen – before the brakes are put on growth once again.