Posted on: 04/06/2024
This week's energy news headlines: More detail is announced on Labour’s plans for a state-owned energy company; Delays on grid connection and battery storage clarity are holding back decarbonisation; An offshore wind farm is to pay £33m into Ofgem’s redress fund over a licence breach. Our industry round-up includes the latest updates from Government departments and energy regulators.
The Department for Energy Security and Net Zero has published the latest comparisons of industrial energy prices against other EU and G7 countries.
The Government has published the latest energy trends data on electricity generation, supply, consumption and fuel use for generation.
Ofgem has confirmed the energy price cap for July to September. It will fall by 7% compared to the previous quarter.
Elexon has switched off the legacy Balancing Mechanism Reporting Service (BMRS) and replaced it with a new wholesale market data platform, Insights Solution.
The Department for Energy Security and Net Zero has launched an open consultation on integrating greenhouse gas removals in the UK Emissions Trading Scheme. The consultation closes on 15 August.
A new publicly-owned green investment company could be up and running within months following the general election, according to Labour leader Sir Keir Starmer.
Starmer said the proposed GB Energy organisation would ensure the UK’s transition away from oil doesn’t repeat mistakes from the phase-out of coal.
The organisation would invest in wind and solar projects, as well as new technologies including floating offshore wind, hydrogen and carbon capture and storage and would be funded through a windfall tax on big oil and gas firms. Labour hopes that each pound of public investment would trigger a further £3 in private-sector funding for projects, and help secure domestic production.
However the Conservatives said the plans were an “unfunded promise” that would cost taxpayers and the SNP said the plans could risk 100,000 jobs in the oil and gas sector in Scotland.
MPs have warned that slow grid connections and a lack of clear plans for energy storage have to be addressed to enable electrification of the UK energy system or risk net zero goals not being met.
The Environmental Audit Committee found that many planned renewable energy projects are being hampered by persistent problems accessing the electricity grid. These include slow connections, limited capacity, inappropriate planning regulations and market uncertainty.
The committee recommends that the Government and Ofgem actively monitor and streamline initiatives designed to deliver grid connections faster. In particular, it recommends that Ofgem review its milestone queue reforms, with a focus on advancing demonstrably ready projects to the front of the queue.
Environmental Audit Committee Chair, Philip Dunne MP, said: “There is no lack of demand to take part in the clean energy revolution; UK businesses are queuing around the block to secure access to the grid. As green technology improves and becomes easier to access, this will only increase.
“Immediately after the General Election, the Government must address these concerns as a priority, and set out clearly how it will balance achieving net zero goals with delivery of a secure energy supply.”
The operator of an offshore wind farm is to pay £33m after admitting it breached energy market rules.
Following a review by Ofgem, Beatrice Offshore Windfarm Limited which operates an 84-turbine wind project off the North East coast of Scotland, accepted it breached a licence condition by charging excessive prices to reduce its generation output when this was required to keep the electricity grid balanced.
The payment will be made into Ofgem's Redress Fund, which funds projects and schemes to support energy consumers, particularly those in vulnerable situations.
The wind farm operator said that in its view the breach was inadvertent and at the time of submitting the bid prices, it had considered that it was compliant. Ofgem said the company co-operated fully with it in its enquiries to resolve the issue quickly and fairly.
It is the fifth action that Ofgem has taken against electricity generation companies since the start of 2023 in relation to breaches of this licence condition.
The nuclear industry has urged an incoming government to use a major nuclear construction programme to ensure momentum in the sector is maintained.
The Nuclear Industry Association (NIA) has set out five key actions for MPs elected on July 4 to support during the next Parliament.
The key points in the industry’s manifesto for the next parliament include progressing Sizewell C to a Final Investment Decision by autumn 2024 and extending the life of current power stations and building a fleet of Small Modular Reactors (SMRs) across the country and a third large-scale station at Wylfa on Anglesey.
The manifesto also urges action to make the UK the best place to develop and deploy advanced nuclear reactors.
The NIA has also published manifestos for the devolved nations of Scotland and Wales.
Accelerating the shift clean energy technologies can relieve pressures on the cost of living, according to a new report.
The International Energy Agency (IEA) said putting the world on track to meet net zero emissions by 2050 requires additional investment but also reduces the operating costs of the global energy system by more than half over the next decade compared with a trajectory based on today’s policy settings.
The IEA said in many cases, clean energy technologies are already more cost competitive over their lifespans than those reliant on conventional fuels like coal, natural gas and oil.
However, it said realising the gains of clean energy transitions hinges on unlocking higher levels of upfront investment.
“The data makes it clear that the quicker you move on clean energy transitions, the more cost effective it is for governments, businesses and households,” said IEA Executive Director Fatih Birol.
“If policy makers and industry leaders put off action and spending today, we will all end up paying more tomorrow.”
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