Informer Issue 578 - 20/12/2022

The next Contracts for Difference (CfD) round, due to open next March, will see offshore wind compete against onshore wind, hydro and solar in the same pot. The fifth round of the renewables support scheme will have two separate pots, comprising a total of 15 technology types. The second pot will see floating offshore wind compete against technologies, including tidal, wave and geothermal. The administrative strike prices for onshore wind and remote island wind have been set at £53/MWh, £47/MWh for solar, £89/MWh for hydro, and offshore wind and floating offshore wind at £44/MWh and £116/MWh respectively. RenewableUK chief executive Dan McGrail said the Government and industry were keen to ensure that billpayers get the maximum benefit from new renewables. “However, we can't ignore rising commodity and labour costs across the world which are increasing the cost of building all energy infrastructure,” he said. "To avoid the risk of the UK losing out on potential investment in the clean energy supply chain, ministers need to take account of these costs in the final budget they set for the upcoming clean power auctions in March.” The Government has also launched a consultation on potential changes for subsequent rounds of the CfD scheme from 2024 onwards. It closes on 7 February. Read more

Six energy trade bodies have joined forces to call for urgent action to address constraints on the electricity network. Organisations including Regen and the Electricity Storage Network have written to the Secretary of State at BEIS asking for his personal leadership on the issue amid concerns that energy projects are facing delays of up to 15 years due to capacity constraints. The trade bodies are concerned that this is delaying billions of pounds of private investment needed to deliver on the UK Government’s targets for renewable energy generation, electricity storage, heat pumps and electric vehicle rapid chargers.
Merlin Hyman, CEO at Regen, commented, “We are in a race to develop renewable power and electricity storage to meet our net zero goals and tackle high bills caused by the UK’s reliance on fossil fuels, but underinvestment in the electricity network is leading to delays of fifteen years for projects to get a connection. “We are calling on the Secretary of State to make enabling clean energy projects to connect the key priority for our electricity system operator, transmission, and distribution networks.” Read more

More than 780MWh of demand reduction was achieved during the first trials of National Grid ESO’s new consumer flexibility service. The system operator has so far run five demonstration tests of the Demand Flexibility Service, and said early data suggested consumer engagement had exceeded expectations. To date, the Demand Flexibility Service test events have delivered over 780MWh of demand reduction, achieving an anticipated £2.8m in savings. Over a 1 million households and businesses have signed up to participate. Further tests will be carried out in the months ahead, with a minimum of two a month to be held between now and the end of March for each provider. These tests will help providers to continue to add and include more customers in the service. Craig Dyke, Head of National Control for the ESO said: “This service successfully proves that consumers up and down the country are standing by to get involved in flexibility solutions. These test results show that if called upon this service will help the ESO balance the national electricity network this winter and is a valuable addition to the ESO’s operational tools.” Read more

Public support for renewables in the fight against climate change has hit a record high, according to a Government survey. BEIS’s latest Public Attitude Tracker found that 88% of people support using renewable energy and only 2% oppose it. The survey showed that 85% of people support offshore wind, 79% back onshore, and 84% support wave and tidal energy. The percentage of people who said they were “very concerned” about climate change has risen from 39% to 45%. The poll also shows the percentage of people aware of the concept of Net Zero remains high at 90% RenewableUK’s Chief Executive Dan McGrail said the polling shows that the overwhelming majority of people want more onshore and offshore wind farms to generate cheap power, increase energy security and tackle climate change. “We need to maximise the range of our homegrown clean power sources to reach net zero and energy independence as fast as possible, so innovative technologies like floating wind, tidal stream and green hydrogen have important roles to play too,” he said. Read more

Ofgem has published a new framework which aims to accelerate the delivery of major onshore transmission projects to help with the push to Net Zero. The regulator said its Accelerated Strategic Transmission Investment (ASTI) framework will enable the transmission owners to implement their delivery plans without delay and is flexible enough to deal with future uncertainty. The publication of the framework follows the setting out of a series of proposed measures by Ofgem to accelerate onshore projects to help meet the targets in the Government’s Energy Security Strategy. Ofgem said its analysis suggests that if all ASTI projects are delivered by their optimal delivery dates, consumers will see a net benefit of up to £2.1bn in terms of reduced constraint costs and carbon savings. However, it stressed that this was “contingent upon timely project delivery”. “We consider that the new ASTI framework strikes the appropriate balance between accelerating delivery of strategic onshore transmission projects and protecting consumers,” it said. Read more

Ofgem has opened a consultation on its proposed programme of work for the 2023/34 financial year. It is seeking views on its consumer interest framework, short and longer-term strategic priorities, and proposed regulatory projects and programmes. More details here.

The regulator has also published the latest annual report for the Feed-in Tariff (FIT) scheme. It includes statistics on the installations accredited, payments made to participants, levelisation, outlines changes to the scheme’s regulations and provides a summary of the audit and compliance programme. More details here.

BEIS has published its response to a consultation on a revenue stream for the nuclear regulated asset base (RAB) model. More details here.

BEIS has published an update to the UK Government’s Hydrogen Strategy, which sets out its approach to developing a sector to meet an increased ambition for 10GW of low carbon hydrogen production capacity by 2030. More details here.

The Scottish Government has published its Hydrogen Action Plan, setting out steps to help the sector in Scotland achieve an ambition of 5GW of renewable and low-carbon by 2030. More details here.