Brian Gilvary, chairman of Ineos Energy, has launched a critique of the UK’s accelerated push towards Net Zero emissions, arguing that the rapid transition risks triggering inflation and unavoidable power outages due to strain on the national grid. He contends that the current policy landscape, characterized by shifting government priorities, renders investments in oil and gas within the UK economically unattractive, despite Ineos’s substantial global investments in these sectors, including a $3 billion outlay in US assets. Gilvary suggests that the UK could improve its energy security by emulating the US and China, advocating for a more balanced energy strategy that incorporates all available domestic resources. He emphasizes the need for this balanced approach to maintain industrial competitiveness, mitigate rising energy costs, and ensure a stable revenue stream for the Exchequer.
Gilvary’s concerns center on the potential economic repercussions of the UK’s ambitious Net Zero targets. He argues that the government’s plan, spearheaded by Energy Secretary Ed Miliband, which aims for clean power by 2030 and entails massive infrastructure investments, could prove excessively expensive and inflationary without substantial subsidies. This view is reinforced by analysts at Cornwall Insight, who predict a potential energy shortfall under the current plan, with only two-thirds of the required energy likely to be met. Gilvary stresses the critical importance of reliable “baseload energy” – the minimum power required to consistently meet demand – arguing that intermittent renewable sources like wind and solar cannot be relied upon until effective and economically viable energy storage solutions, such as green hydrogen, are developed, which he estimates to be decades away. He warns that without a secure baseload energy supply, power cuts and strain on the grid are inevitable.
The precarious state of the UK’s energy security is underscored by recent events. Analysts have warned of the grid’s vulnerability to blackouts, with the country’s gas storage reportedly holding less than a week’s supply. This fragile situation further emphasizes Gilvary’s concerns about the potential consequences of relying too heavily on intermittent renewable energy sources without sufficient backup. The debate over the UK’s energy future highlights the complex balancing act required to transition to cleaner energy sources while ensuring a stable and affordable supply of power.
Beyond the energy sector, other businesses are facing challenges. Cosmetics giant Estée Lauder is reportedly undergoing a strategic review of its brand portfolio, potentially leading to the sale of some of its well-known brands, including Clinique and Tom Ford. This move comes as the company grapples with changing consumer preferences and increased competition from newer, digitally savvy startups that effectively target younger demographics through social media. The appointment of Stéphane de La Faverie as the new CEO signals a potential shift in direction for Estée Lauder as it seeks to adapt to the evolving beauty market.
Meanwhile, Halfords, the UK bike retailer and garages firm, has experienced a surge in sales, driven by strong demand for bicycles during the Christmas period and increased sales of car products due to cold weather. This unexpected boost has led the company to revise its profit forecasts upwards, exceeding analysts’ expectations and boosting investor confidence. Conversely, Pets at Home has issued a warning about a subdued market, citing weaker retail sales in the run-up to Christmas. The company attributes this downturn to the end of the pandemic pet “baby boom” and decreased footfall in its stores. While its veterinary services have seen revenue growth, the overall performance reflects a broader trend of declining consumer confidence in the wake of recent economic developments.
Finally, Smiths Group, an engineering firm specializing in baggage screening and bomb detection equipment, has become the latest victim of a cyberattack. The company has confirmed unauthorized access to its systems and is working with cybersecurity experts to manage the situation. This incident follows a series of cyberattacks on UK businesses, highlighting the increasing vulnerability of companies to such threats. The attack on Smiths Group underscores the importance of robust cybersecurity measures in protecting sensitive data and maintaining business continuity. The incident serves as a reminder of the pervasive nature of cyber threats and the need for constant vigilance in safeguarding against them.
