The Jersey Power Game

The States of Jersey’s energy plan, Pathway 2050, targets an 80% reduction in CO2 emissions by 2050. Jersey Electricity – which holds a monopoly on electricity supplying in the Island, says it’s already virtually de-carbonised its supply and wants to switch more customers over to electricity. Meanwhile, Jersey Gas, which broke the Guernsey Electricity monopoly last year, says it wants to start generating green power in the Island. Gwyn Garfield-Bennett met both Managing Directors to hear their visions for Jersey’s power needs.

 Jersey Gas

Jersey Gas comes under a holding company, International Energy Group (IEG), which also owns Manx Gas and Guernsey Gas. IEG is in turn owned by Ancala an infrastructure fund. Last year IEG secured a licence to break Guernsey Electricity’s monopoly and is now able to generate and supply electricity there via its Combined Heat and Power technology.

 

The Managing Director of IEG, Ian Plenderleith is not surprisingly quick to assert that gas will be around for a long time yet: ‘We’re not talking the dirtiest of fuels, which is coal, we’re also talking about something which is highly efficient in terms of generation.

‘It isn’t going to go today and if it did the cost of replacing it would be truly enormous, and it’s not going to go in five or ten years either.

‘If you want to transition to a carbon free world that’s not going to be something you do overnight. Renewables that exist today, which are primarily around solar and wind, are they really going to be cost effective at this point in time? Will they be able to replace gas to fill the heating load that we provide in the winter months when there may be more wind but certainly less solar.

‘If we were looking forward five or ten years around renewable technology, we probably won’t be talking about the current renewables as they stand today.  If we’re looking at what’s happening in the gas sector, we’re looking at opportunities with hydrogen networks, we’ll have opportunities to get LNG (liquefied natural gas), on the island - which is lower cost. There’ll be bio gases that will be much easier to produce. So in five or ten years that renewable landscape will look very different again.’

 

Also not surprisingly, Mr Plenderleith is keen to duplicate the breaking of the electricity monopoly in Jersey:  ‘I think it’s a great foresight that the States of Guernsey has issued an electricity licence to somebody other than Guernsey Electric which is starting to liberalise and democratise the provision of energy services across the island.  Doing that has enabled us to look into new markets, new developments, new products. So we have some significant opportunities to grow the business, to bring new technologies to the island to bring new skills onto the island. To make a contribution to the green economy on the island, on island generation, improvements in security of supply, the improvements in affordability for bills going forward. So that’s a particularly exciting time for us there and certainly what we’d be hoping for, as time goes on in Jersey, is to see the same.’

You can read the full interview with Ian Plenderleith in the November issue of Business Brief

Jersey Electricity

Chris Ambler has held the reins of Jersey Electricity for the past ten years and in that time the business model has been transformed from an on-island generator of power, to one built around imported low-carbon energy. Jersey Electricity is a public limited company whose main shareholder is the States of Jersey. It is also the only provider of electricity in the Island.  While some challenge that monopoly position, Chris Ambler says it’s the reason why Jersey’s electricity prices are lower than the UK and many other places in Europe, and why Jersey is way ahead of many other countries in reducing carbon usage and its subsequent damage to the environment:  ‘We have now virtually de-carbonised the electricity system. Those local on-island generation systems are there for back-up. The composition of the imported power from France is two-thirds nuclear and one-third renewable hydroelectric and it is certificated so we know the source.’

Purists would argue that nuclear is not where we want to be, that it’s to renewables where we should be focusing, but Mr Ambler is quick to say that many renewables are simply not economically viable and would push prices up:  ‘Power prices in Jersey are now 15% to 20% lower than Guernsey, we’re 15% to 20% lower than the Isle of Man, we’re about  15% lower than the UK and EU average.‘

‘That said we know that customers are wanting us to do more on renewables locally and so we can do that and are happy to do that and a couple of months ago we launched a request for expressions of interest in a ground based solar development. The reason we’ve done that is we’ve looked across the landscape of renewable technologies and there are only some which are economically viable, a lot of them are not economically viable and require subsidy if those schemes are to be developed, and the challenge that presents is that anything that requires subsidy needs to be funded and would need to come from government funding which will ultimately lead to higher taxation.’

You can read the full interview with Chris Ambler in the November issue of Business Brief