What the new nuclear power station says about future oil prices

The unionist parties like to emphasise the uncertainty about future oil prices (e.g., “The tax we get from the North Sea is so volatile that the difference between the highest and lowest years is the equivalent of Scotland’s NHS budget”).

However, talking about Westminster’s decision to give the go-ahead for the UK’s first new nuclear station in a generation, and to guarantee the investors an electricity price that is almost twice the current wholesale cost of electricity, Energy Secretary Ed Davey said:

‘People won’t be paying this for ten years’ time and in ten years’ time we’ll be in a very different world – we’ll have had to replace all those nuclear power stations and coal power stations and we’re likely to see carbon prices going up and so on,’ he told BBC1’s Breakfast.

In other words, he’s implying that future energy prices will be much higher than they are at the moment, which is bad news for consumers everywhere, but excellent news for an independent Scotland. If Ed Davey expects energy prices to double over the next ten years, it means he must be expecting North Sea oil prices to rise by a similar amount, too.

Given the amounts of energy produced in Scotland, sky-high energy prices is an advantage for an independent Scotland, but this is not the case for the UK as a whole. Only in an independent Scotland can we use the increased revenue from rising oil and gas prices to make energy more affordable for the people living here.