UK consumers are facing an additional £7 billion charge on their gas bills, a consequence of the ongoing global energy crisis that has seen gas prices soar to unprecedented levels. The hefty bill is expected to exert further strain on already tight household budgets across the country.

The research, conducted by the Nuclear Industry Association (NIA) and shared with City A.M, revealed that the National Grid Electricity Systems Operator (ESO) spent a staggering £7 billion of consumer funds on gas in 2022 and 2023 to supplement energy supply when renewable sources fell short. This figure marks a significant increase from the £3 billion spent during 2019 and 2020.

In 2023 alone, the cost of balancing the grid amounted to £2.85 billion, which translates to an additional £80 per year for every electricity consumer in Britain, encompassing both households and businesses. Balancing the grid, a necessary process to match electricity supply with demand in real-time, has become increasingly challenging and costly as the predictability of renewable energy generation remains volatile.

Tom Greatrex, chief executive of the Nuclear Industry Association, commented on the situation, stating, "These costs are the price of the UK not investing in nuclear power, but if we ramp up nuclear at scale and at pace to the levels needed for energy security and net zero then we can avoid having to rely on expensive fossil gas to fill gaps in generation."

The NIA has highlighted the surging costs as a direct result of declining baseload capacity, which is the consistent energy provided regardless of external factors, as aging nuclear stations retire without immediate replacement. The organization underscores the importance of nuclear energy, which has prevented over 2.3 billion tonnes of carbon emissions in the UK, outpacing other energy sources in this regard.

The UK government's recent guidance indicates that initiating a nuclear project would minimally impact consumer bills during its construction phase. The current nuclear infrastructure in the UK consists of five generating stations, delivering approximately 14% of the nation's electricity. However, with all but one station scheduled to go offline by 2030 and significant delays and cost overruns plaguing new projects like Sizewell C and Hinkley Point C, the future of nuclear energy in the UK remains uncertain.

In response to these challenges, the UK government unveiled a nuclear sector roadmap earlier this year, which includes plans to develop small modular reactors (SMRs) and another major project akin to Hinkley Point. This initiative is part of a broader £60 billion strategy announced by the Grid to revamp the UK's electricity system, anchored by ambitious offshore wind project targets.

The escalating costs associated with balancing the National Grid serve as a stark reminder of the economic consequences of the country's energy policy decisions.

Originally reported by OilPrice.com