United Kingdom - Energy and power

Coal supplied 15.7% of the UK's primary energy consumption in 1999; oil, 35%; natural gas, 34.9%; and hydroelectric and other renewable sources supplied the rest.

The United Kingdom is one of the largest oil producers in the world, thanks to its offshore oil reserves in the North Sea. Proven reserves totaled five billion barrels as of 2002. Oil fields comparable in size to those of the Middle East were first discovered in the British sector of the North Sea in October 1970. Because of delays in pipeline and platform construction, the first oil was not piped ashore until October 1975. Production reached 2.75 million barrels per day in 2000; the output has gradually increased since 1991. Natural gas was first discovered on the continental shelf in 1965, and production began in 1967. In early 2002, natural gas reserves were estimated at over 758.7 billion cum. Production in 1999 was 98.8 billion cu m, among the highest in the world. Continuing the ongoing restructuring of the UK's oil industry, the merger of BP Amoco with Atlantic Richfield (Arco) was finalized in 2000, creating the third-largest publicly traded oil and gas company in the world. The United Kingdom is simultaneously a major importer and exporter of oil. Since North Sea oil is a light, high-quality oil, the UK exports this oil and imports crude oils of various qualities. Violent storms can adversely affect production.

Nationalized in 1947, the electricity supply industry, which is the largest consumer of primary fuel, is under the jurisdiction of the Ministry of Power. In England and Wales, electricity is generated and transmitted by the Central Electricity Generating Board and distributed by 12 area electricity boards under the supervision of the Electricity Council. Scotland and Northern Ireland have separate electricity authorities. A national grid of main transmission lines supplies electrical power to most of the country. The Energy Act of 1983 allowed competition from private generators of electricity. In 1991, the United Kingdom signed the European Energy Charter, which promotes cooperation and an open energy market between EC members, the US, Japan, and Australia.

The production and consumption of coal have decreased greatly since the late 1980s, when coal supplied two-thirds of the UK's thermal generating stations. As of 2002, that share had shrunk to less than half and it was expected to fall below one-third by 2010. Coal production declined from 119 million tons in 1986 to 40.9 million tons in 1999.

In 2002 the United Kingdom was Europe's third-largest electricity market. As of 1999 the privatization of the British electricity sector, begun in the early 1990s, was complete, with small as well as large customers able to choose their own suppliers. Deregulation of utilities has increased competition for power sales in Britain. As a result of the restructuring, the United Kingdom had 27 power companies as of 2002. The United Kingdom was the first country to have a nuclear power station supplying electricity to a national network (its first station was Calder Hall, in Cumberland, opened in 1956). By the end of 1995, combined nuclear generating capacity from 35 reactors was 12,908 MW. Total electricity generated by power stations in the United Kingdom in 2000 amounted to 351,900 million kWh, of which 73.3% was from fossil fuels, 1.5% from hydropower, 23% from nuclear power, and the rest from other renewable sources. Consumption of electricity in 2000 was 345 billion kWh. Total installed capacity in 2001 was 76,304 kW. As much as 10% of Britain's electricity needs could be satisfied by wind power, according to the government's renewable energy research program. Tidal power, passive solar design, and biofuels also show promise.

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