The Informer

This week’s headlines: Businesses need to dramatically increase their spending on low carbon investments such as renewable energy and demand-side response to help hit net zero; the UK is named Europe’s leading country for new wind capacity; and balancing costs hit a record high after a key power link goes down.

  • Businesses urged to step up low carbon spend

    Businesses need to double their current levels of investment in areas such as renewable energy, demand-side response and electric vehicle fleets to help achieve net zero targets, according to a new report.

    The study by climate disclosure organisation CDP and consulting firm Oliver Wyman found that European companies reported £104bn in new low carbon investments last year, representing 12% of their average capital expenditure. But the report said that spending figure needs to hit 25% to be on track to achieve 2050 net zero goals.

    The report said businesses from Germany, Spain and Italy had the highest levels of low-carbon investment last year while the UK finished sixth, below France and Denmark.

    Steven Tebbe, managing director of CDP in Europe, said achieving net zero requires a “fundamental transformation of our economic business model.”

    “The investment decisions taken by European companies and their owners will make or break whether we are successful – and they need to double down.”

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  • UK leads Europe on new wind power

    The UK installed 2.4GW of new wind capacity last year, the highest figure of any country in Europe.

    Across the continent some 15.4GW of wind capacity was added, according to figures from trade body WindEurope.

    Onshore wind provided 11.8GW of the increase, with offshore wind supplying the other 3.6GW, taking Europe’s overall total wind capacity to 205GW and providing 15% of the electricity it consumed.

    Germany’s wind industry came to a “standstill” last year, with Spain and Sweden taking up the slack.

    But Giles Dickson, Chief Executive at WindEurope, warned: “Climate neutrality and the Green Deal require Europe to install over twice as much new wind energy each year as it managed in 2019."

    “That requires a new approach to planning and permitting and continued investment in power grids.”

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  • Balancing costs hit record high during link outage

    The cost of turning down wind output through the Balancing Mechanism hit a record high after a power link between Scotland and England went down, according to new figures.

    Analysis by Cornwall Energy found significant volumes of wind energy had to be constrained during an unplanned outage on the Western Link HVDC connection.

    The shutdown between 10 January to 8 February coincided with record-high levels of wind generation in the UK of 6.3 terrawatt-hours.

    Cornwall said the cost of turning down wind output through the Balancing Mechanism hit a record high of £30.9m.

    Cornwall Insight analyst Lee Drummee said: “The Western Link was designed to accommodate the increasingly high volume of power generated in Scotland and prevent transmission bottlenecks. But since commissioning the cable has been fraught with issues."

    “The reliability of the Western Link will need to be solved for its full potential to be realised. As more onshore wind develops, especially in Scotland, the problems of constraints will need to continue to be actively managed.”

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  • Digitalisation barriers holding back energy transition

    Transmission and distribution companies are lagging behind other players in the energy industry when it comes to digitalisation, according to a report from consultancy firm DNV GL.

    Only 52% of distribution companies and 39% of transmission firms have digitalisation as part of their strategies.

    Two-thirds of distribution and transmission businesses are trying to recruit staff with digital skills to help alleviate the issue.

    They want to take on workers with knowledge about the internet of things, data science and big data analytics.

    Lucy Craig, Vice President of Technology & Innovation at DNV GL Energy, said: “Although the technology and ambition might be there, unless organisations can concentrate the efforts of their entire workforce towards the adoption of new technologies and harvesting the opportunities provided by big data and enhanced connectivity, the impact of digitalisation will be limited.”

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  • Clean hydrogen projects secure funding

    Europe’s first large-scale, low-carbon hydrogen production plants have received £70 million as part of a £90m package from the Department for Business, Energy & Industrial Strategy (BEIS).

    Energy Minister Kwasi Kwarteng unveiled the backing for hydrogen plants on the Mersey and near Aberdeen, and the Gigastack project to harness offshore wind from the Grimsby coast to power electrolysis and produce hydrogen.

    A further £20m will be used to fund projects aimed at cutting household emissions and bills through nine UK-wide local “smart energy” projects.

    Rebecca Williams, Head of Regulation & Policy at trade body RenewableUK, said: “Green hydrogen has the potential to be a gamechanger in the energy sector, accelerating the transition to net zero emissions.

    “Gigastack is a ground-breaking project, with what will be the world’s largest offshore wind farm set to provide renewable electricity to make green hydrogen, which can be stored to make our power system more flexible, or used as a clean fuel for transport, industry and heating.”

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