Renewable energy is doing quite well in the UK, as the latest Office of National Statistics report shows, although it says there is uneven development. ‘What is working is now clear, with power generation, storage & transport electrification are delivering scale, investment & export potential. What is not working is balance. Jobs are volatile, heat is underperforming & delivery capacity is struggling to keep pace with ambition’.
There certainly are some ambitious targets. In an interesting interview, Net Zero Mission Controller Chris Stark say how the UK energy team set a range ‘for all the clean technologies, so onshore wind, offshore wind, solar [and] also the energy storage technologies…that we’re trying to hit by 2030 that is right at the top end of what we think is possible. Then we went about constructing the policies to make that happen.’ And he says it is working, so far: the economics of clean energy ‘just get better and better’, with renewables being clearly cheaper than gas.
Well not everyone will agree with that, and not just the Tory opposition and Reform: as I have noted in earlier Blogs, the Tony Blair Institute, and the Global Warming Policy Foundation also claimed that, when system balancing and grid upgrade and management costs are included, consumers bills will continue to rise, while gas will be a better bet.
However, in a new report, the Renewable Energy Association says that, when social/employment gains are included, ‘by 2028 to 2029 renewable energy will be the most economically favourable option for electricity generation compared with continued reliance on natural gas. This remains the case even when accounting for associated infrastructure costs such as grid, transmission, storage & system upgrades, offering a realistic assessment beyond traditional Levelised Cost of Energy estimates’.
The modelling assumes unchanged natural gas prices for five years. But the REA says even if ‘prices fall by twenty- five per cent between 2025 and 2030, the economic advantage of renewables, excluding jobs, is delayed by only one year. Additional benefits such as reduced exposure to volatile gas markets, improved energy security and environmental gains further strengthen the case.’ So, it says ‘continued government commitment and interim measures, including potential reductions to green levies and value added tax, are recommended to manage near term electricity costs. Stable policy will support investment and deliver clear economic benefits’.
In conclusion, the REA says renewables will not be cheap, but then ‘rising capital demands, supply chain pressures and geopolitical volatility mean all forms of generation are going to ultimately be costly’. Nevertheless, ‘investing in renewables now will secure long term economic gains, skilled domestic employment, cleaner energy and greater energy security. Despite high overall generation costs, renewables represent the most economically sound long-term investment for the United Kingdom’.
However, there is still some way to go. For example, Carbon Brief said onshore wind and solar technologies ‘need to double in operational capacity over the next four years to reach the 2030 targets,.’ It noted the RenewableUK view that between 3.85 GW to 4.85 GW more onshore wind was needed in in the next two CfD auctions, and Aurora’s view that the gap for solar to reach its 45-47 GW target is still a ‘whopping 18 GW’, although the stimulus by the Warm Homes plan may help. Offshore wind would also help: Carbon Brief noted that 10 GW more had already got CfD contracts before the 8.4 GW added by AR7, though it said, even if all that gets built, it still means there would be at least a 7 GW gap.
So quite a lot more was needed, with Cornwall Insight being quoted as saying that, for all projects, ‘the challenge now is delivery… Historically, it renewable projects in the UK have faced delays, often due to grid connection backlogs & planning holdups. With AR7 & some of AR8 representing the only realistic pipeline for pre-2030 capacity, keeping to schedule will be essential.’
Let’s hope progress continues to be made in the UK - unlike in France and Germany where renewable targets have recently been cut by right wing governments. The election of a new green MP in Manchester, taking 41% of the vote, and overturning a massive Labour majority, may indicate a different trend in the UK. Labour do seem to be in trouble ….the Tories even more so. Who knows what will happen next?
While its worth remembering that there are still only 5 Green MPs in the UK, it is possible that the national green vote will expand. Would that mean more green energy? There’s a very long way to go, and, for good or ill, the Green party have moved beyond just focussing on environmental issues, but the Green’s last Manifesto looked to wind to provide around 70% of the UK’s electricity by 2030, with 80GW of offshore wind, and 53 GW of onshore wind, along with 100 GW of solar by 2035. That’s more ambitious than Labours plan, which itself was quite radical, but unlike Labour, the Greens don’t back nuclear, so, arguably, they would have more money to spend on renewables, energy saving and storage.
Reform, by contrast, seems to want to halt all that sort of nonsense and go for fossil fuel and nuclear! So evidently do the Tories. We live in interesting times! However, although the way ahead ought to be clear, it’s not going to be easy making the transition that is needed, especially given the rise of reactionary populism. And also yet more wars.
Although horrific in human terms, the war with Iran (ostensibly at least started because of its uranium enrichment plans) has pushed global fossil oil and gas prices up. Consultants Wood Mackenzie noted that ‘The prospect of around 20 per cent of the world’s LNG being cut off from the market has unsurprisingly led to a sharp rise in prices’ and it my get worse, depending on how long the Strait of Hormuz remain closed. There’s talk of UK energy bills reaching £2,500 p.a. About the only consolation is that all of this should further improve the prospects for green energy. But at what an appalling cost – to us all. It just reinforces the climate action message: the faster we can all move away from reliance on fossil fuel the better, with renewables the clear way ahead - albeit, in Labour’s UK, with nuclear also still in there, soaking up resources.
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