Our tech industry is one of our best economic opportunities. But it’s hugely energy dependent, and our energy prices are among the highest in the world. Without urgent action, we risk losing out.
In 2022, the UK’s technology industry was valued at over $1 trillion, making it the largest in Europe and the third largest worldwide, behind only the US and China. The UK also ranks fourth in the global AI index, showing strength in key areas such as talent availability and R&D.
This is a uniquely valuable opportunity for an economy that so urgently needs substantial, sustained growth.
The current Labour government has made a commitment to cultivating a robust tech sector, with a particular emphasis on AI. But the challenge of energy costs has been largely ignored, despite being identified as a challenge in the global AI rankings, presumably due in large part to incompatibility with Net Zero policy.
Proposal
Energy market reforms which lower costs could take years, risking our competitive edge in technology. Immediate action is necessary.
Short-term measures, such as targeted subsidies or special reliefs, should be introduced to alleviate the energy cost burden on energy-intensive yet economically vital businesses.
Agreed - as a short-term measure until other policies that aim to develop our own energy sources and increase the availability of energy in Britain begin to take effect.
I wonder if one could help drive the other. It’s been proposed that data centres could have their own, mini nuclear power stations. Perhaps we can leverage the investment needed to support a tech industry to drive new energy infrastructure for the wider economy, including domestic.
Sounds like a strong possibility. I guess you are referring to small modular nuclear reactors. I haven’t read up on this technology in any detail, but one advantage they are supposed to have is, being repeatably produced, their deployment and commissioning (including safety verification) is substantially simplified. At the end of service life, the entire unit (or at least the entire reactor assembly) is replaced. This does not involve exposing or handling radioactive materials on site, these remain inside the unit which is sealed.
Yes, that’s the gist of it. I’m no expert, but I assume that driving a large industrial demand for these units (i.e. by fostering energy-intensive tech operations) will make them, and the attendant infrastructure, more accessible for the domestic market.
Oh gosh. This raises the whole net zero subject again. We are bankrupting the country through higher energy bills through a messianic quest to reduce emissions on this tiny island, while China is happily building coal fired power stations at speed, and we anyway buy the products no longer made here, produced elsewhere at lower prices, due in part to lower energy costs. . It’s quite bonkers. What happened to common sense?
