My inaugural lecture examined whether energy policy has reached a crossroads where clear directions may be made, or whether energy policy is at a roundabout simply going round and round from old issues to new ones and returning time and time again to the same old issues that haven't been successfully addressed in the first place.In 1990, the privatization and liberalisation of the electricity sector in the UK marked the beginning of a worldwide trend. Generic reform models assume generation and supply of electricity are potentially competitive activities that can operate under market mechanisms while the transmission and distribution networks are natural monopolies and need to be subject to incentive regulation. For developed economies the main aim of reform was to improve efficiency of the sector while the developing countries also sought cost reflective pricing and private capital reducing the burden on public finances. However, as we have seen, the performance of these reform models has been mixed. The dynamics of the sector and changing external challenges have made coherent and lasting policy formulation difficult.
Meanwhile the climate change debate has gained increasing prominence and the potential role of the electricity sector towards achieving a low carbon economy has placed it in the centre stage in this debate. As the renewable targets remain elusive, the contrast between liberalisation and climate change in the sector is reaching a critical point.
Alongside this new issues are constantly emerging in the energy policy: planning and permissions, smart meters, energy efficiency measures, carbon markets, technology policy, security of supply, quality of service, and investment levels. The dynamics of the sector and changing external challenges have made coherent and lasting policy formulation difficult.
