Coal, Oil and Nuclear Escalation

The British economy had long been built on energy from coal, and even as late as the mid-1950s commentators were convinced that this would remain so for many years to come. The electricity supply industry at first shared this view and, as it happened, it was to prove a more accurate prognosis of its own future source of fuel than it was in other sectors, where the future potential of oil was generally underestimated. There were, of course, postwar shortages and worries about future coal supplies. However, in the few harsh winters of the early 1950s when home coal production seemed likely to be insufficient to maintain electricity supplies, the National Coal Board had been able to provide small quantities of imported coal at a subsidised price. Even if world market prices had been charged for such marginal additions, they would still have been substantially cheaper than oil. The Ridley Committee (which reported on fuel and power resources in 1952) expected the Coal Board to be able to expand coal production in the medium-term to meet the greater part of increasing UK demand for energy at prices which would remain competitive with oil.1 The major criticisms of this view at the time were that the committee had under-estimated the size of the future demand for coal, though experience was to show the contrary. Demand for coal was in fact to be well below their estimate, as oil made more rapid competitive advances in the fuel market than had been expected.