Posted on: 16/07/2024
This week's energy news headlines: The system operator says the next two years will be crucial for action to support the Net Zero push; The Government is urged to increase the CfD auction budget to support more offshore wind; A new National Wealth Fund is being set up to help boost clean energy investment. Our industry round-up includes the latest updates from Government departments and energy regulators.
Elexon has published its first Digitalisation Strategy and Action Plan to support Net Zero. It details how it will make half-hourly consumption data available to companies and innovators once Market-wide Half Hourly Settlement (MHHS) is live.
Ofgem has published its decision to send back the Connection and Use of System Charges modification proposal CMP414 which seeks to allow new connectees to construct transmission assets to facilitate their connection to the wider transmission network. Ofgem said it wanted greater clarity on the analysis and impacts of the proposed changes.
The Department for Energy Security and Net Zero has published a policy statement on onshore wind, making revisions to planning policy that place onshore wind on the same footing as other energy development in the National Planning Policy Framework (NPPF).
Renewable UK has published a report on Labour’s plans to set up GB Energy as a state-backed company to invest in new renewable energy projects.
Decisive action is needed within the next two years to deliver the major changes needed to enable a net zero energy system by 2050, National Grid ESO has concluded.
In its latest Future Energy Scenarios report, the system operator sets out a series of steps it says are needed for delivery of cleaner, cheaper energy generation and security of supply.
They include market and planning reforms, a strategic approach to network investment, and greater use of smart technology to enable consumers to save on costs while helping with the management of the system.
The ESO also identifies the use of hydrogen for hard-to-electrify applications as a priority, along with acceleration of new technologies and long-duration energy storage connected to the system through reform of the connections process.
Claire Dykta, the ESO’s Director of Strategy & Policy, said: “Without decisive action within the next two years there is a risk of emissions remaining high, particularly in the heat sector.”
The Government has been urged to get its 2030 offshore wind target back on track by increasing the budget for the technology in the upcoming CfD auction.
Climate change think tank Ember warned the “stakes are high” as the industry needs long term confidence, and every gigawatt of offshore wind below target means greater exposure to expensive fossil fuel imports.
It said the new Government has until 1 August to set a higher offshore wind budget for this summer’s auction and says a 25% increase could deliver an additional 1GW of commissioned projects on top of existing expectations,
In the longer term, it said the CfD mechanism needs to be evolved, changing the focus from competition to moving a large number of sites through development.
A new National Wealth Fund to mobilise billions of pounds of investment in industries including clean energy has been unveiled.
Under the new Government’s plans, the fund will bring together key institutions and a “compelling proposition” for investors.
A total £7.3bn of additional funding will be allocated through the UK Infrastructure Bank so investments can start being made immediately, focusing on further priority sectors and catalysing private investment at a greater scale.
Energy Security and Net Zero Secretary Ed Miliband said: “Our Mission to make Britain a clean energy superpower is about investing in Britain. Our National Wealth Fund will help create thousands of jobs in the clean energy industries of the future to boost our energy independence and tackle climate change.
“We’re acting immediately, wasting no time and working in lock-step with industry to unleash private investment and grow our economy.”
The world risks missing the target of a tripling of renewables pledged at COP28 unless the pace of capacity growth accelerates.
Latest figures from the International Renewable Energy Agency (IRENA) shows renewables now need to grow at rate of a minimum 16.4% annually through 2030.
Last year saw a record 14% increase in capacity but if growth continues at that level, the tripling target of 11.2 Terawatts (TW) in 2030 will fall 1.5TW short, missing the target by 13.5%. If the world keeps the historic annual growth rate of 10%, it will only accumulate 7.5TW of renewables capacity by 2030, missing the target by almost a third.
IRENA Director-General Francesco La Camera said: “Renewable energy has been increasingly outperforming fossil fuels, but it is not the time to be complacent. Renewables must grow at higher speed and scale.”
The average UK business is spending £5,160 for their energy annually, 12.6% more than recorded three months ago according to new figures.
However, the figure is 17.7% less than the figure this time last year and around half that at the peak of the energy crisis in Q4 2022, analysis by energy software business POWWR showed.
The figures also show significant regional differences in business energy bills due to varying climate conditions and the type of industries found in each region.
Companies in the North East of England pay the least (£4,300) for their energy, but those in North Wales pay over £2,400 more (£6,761).
The report also shows that energy usage across the UK continues to decline quarter on quarter, likely due to initiatives brought upon by a mixture of environmental concerns and fears of rising energy prices. The average UK business now consumes 23MwH of energy a year, 12.3% less than they did last year.
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