Delay is a decision too

The claim is that the move to net zero is driving up energy bills and driving manufacturers out of the UK. Denby Pottery, which went into administration in March after more than 200 years, is often given as the example.

UK industrial electricity prices are the highest among the developed economies in the International Energy Agency. The main reason is gas. In Britain the most expensive plant needed to meet demand sets the price for all electricity, and that is nearly always a gas power station. In 2021 gas set the price 97% of the time here, against 36% across the EU and 7% in France. Countries with more nuclear and hydro power, or with cheap gas of their own, pay less. Wholesale energy, largely driven by gas, still makes up nearly half of the capped household bill.

Denby itself gave soaring gas costs as the reason for its administration. Gas is about 86% of the energy used by the ceramics industry, and most potteries could not use the government’s relief schemes, which help with electricity rather than gas.

The concern is fair. Prices are high, and manufacturers have been warning for years that this is pushing industry out. Policy costs are part of the bill, and Make UK estimates that removing levies would cut business electricity bills by about 15%. New renewables are not free of cost either. But they do not move with the gas market.

Another way to see it

The underlying problem is exposure to the world price of gas. Every unit of electricity that does not come from gas is a unit whose price that market does not set. Moving levies off electricity bills, reforming how power is priced, and extending relief to gas-intensive manufacturers while they change would all help now. None of them requires slowing the transition.

The fullest version of this comes from Sir Richard Dearlove, the former head of MI6, in a lecture to the Global Warming Policy Foundation in September. His case is that Britain has lost the industry needed to build and repair its own energy system. Industrial energy use has fallen by about 70% since 1974. Large transformers now take two years to arrive and generators up to three. The special steel that transformers need comes largely from China, which the head of MI6 has called the most serious threat to our security. A country without heavy industry also has no factories to switch off in a shortage, so households take the cuts. He regards this dependence on equipment as a graver danger than a temporary shortage of gas. He adds that Chinese equipment can be controlled remotely by its maker, and that Russia has invested in the means to attack undersea cables and pipelines.

Much of this is borne out by the evidence. China has about 80% of the world’s solar manufacturing and makes more than half of the electrical steel used in transformers. Remote access to connected equipment is a real risk: tests by Oslo’s transport operator in 2025 found that the Chinese maker of its electric buses had remote access to them and could in theory stop them. His remedies are sound too. He asks for a national energy strategy that identifies single points of failure and builds contingencies around them, and for strategic industries to be rebuilt. It is the kind of supply chain risk management that boards already practise.

The evidence does not support the link to net zero. The deindustrialisation he describes is 50 years old. Official figures show that industrial energy use was already 61% below its 1970 level by 2013, six years before net zero became law. He says himself that we did this to ourselves over decades. The equipment in question is needed by any grid: a gas or nuclear station needs a generator and a transformer as much as a wind farm does. The one UK plant that made electrical steel for transformers, the Orb works in Newport, closed in 2020 because its owner would not spend about £50m to modernise it and no buyer came forward. Reversing course on net zero would not reopen it. It is fair to add that electrification means a much bigger grid, which increases exposure to this supply chain.

On which dependency is graver, the record points the other way. A shortage of equipment slows new building and makes repairs harder, but it does not stop existing plant from running. A shortage of gas reaches every home and business at once. The Office for Budget Responsibility put government support for energy and living costs in 2022-23 and 2023-24 at £78bn. (The Treasury’s figure of £94bn also counts wider measures such as benefit uprating.) This year the war with Iran, which began on 28 February, has raised bills again: Ofgem lifted the price cap by 13% in July and a further 4% in October and gave wholesale gas as the reason. His warning about Russia and undersea pipelines applies with most force to gas, because most of what the UK burns is imported. A wind farm that is already built keeps generating whatever happens in the Gulf.

Some commentators have also predicted blackouts this winter. The system operator’s early assessment is a spare margin of 5.5 gigawatts and an expected loss of supply of under 0.1 hours a year, against a reliability standard of 3 hours. The official inquiry into the 2025 blackout in Spain and Portugal found no single cause. It identified failures of voltage control and of protection settings, and made 22 recommendations. That is a lesson about running a grid with a lot of solar on it, and the remedies are known.

Sir Richard says he is not qualified to argue the science, and he treats climate change as a natural hazard. NATO, of which Britain is a founding member, describes it as a threat multiplier.

Another way to see it

Energy security and climate action point in the same direction. Securing supply chains, setting security rules for connected equipment as was done for Huawei in telecoms, holding strategic spares and cutting the fuel we import all make the country safer. Sir Richard’s remedy does not require stopping the transition. It makes the transition more resilient.