Posted on: 02/01/2024
This week's energy news headlines: The UK’s renewable energy projects generated enough to power all of the nation’s homes in 2023; The battery storage pipeline has grown by more than two-thirds in the past year; The Government confirms the Emissions Trading Scheme will be extended out to 2050; Our industry round-up includes the latest updates from Government departments and energy regulators.
Renewable energy generated in 2023 was more than enough to power all of the UK’s 28 million homes, according to new figures.
Analysis from the Energy and Climate Intelligence Unit (ECIU) found that the UK’s wind, hydro and solar projects are estimated to have produced over 90TWh during the year.
Renewable generation has also increased in each quarter of 2023, compared to 2019 which is seen as the last ‘normal’ year as the coronavirus pandemic and gas crisis skewed the data for other years. It grew by around a quarter and a fifth in Q1 and Q4 2023 respectively. Gas generation has fallen by 20-30% in each quarter of the year, compared to the same quarter in 2019.
Jess Ralston, Head of Energy at ECIU, said: “Every turn of an offshore wind turbine’s blades reduces our dependence on gas. “As the North Sea continues its inevitable decline, we’ll need to import ever greater quantities of gas, undermining our energy independence. The choice for the UK is stark. Boost British renewables or import more gas at a price we can’t control."
The UK’s pipeline of energy storage projects has increased by more than two-thirds over the last year, according to a new report. RenewableUK’s analysis shows that the capacity of projects which are operational, under construction, consented or being planned has increased from 50.3GW a year ago to 84.8GW.
Operational battery storage capacity has grown to 3.5GW, and the capacity of projects under construction has reached 3.8GW. A further 24.5GW has been consented, 27.4GW has been submitted in the planning system and 25.7GW is at an early stage of development but yet to be submitted.
England has 60% of the overall pipeline of UK projects (50.7GW) including the highest capacity of fully commissioned battery storage projects (2.8GW). Scotland has the second largest pipeline at 29.5GW.
RenewableUK’s Director of Future Electricity Systems Barnaby Wharton said: “While the battery market is booming, we need investment in even larger projects to store energy for longer, unlocking further opportunities for us to scale up this cutting-edge technology. We’re still waiting for the Government to confirm how they will stabilise revenues for long duration projects.”
The UK’s Emissions Trading Scheme will be extended beyond 2030 to 2050, the Government has confirmed.
In an update published alongside the launch of two consultations into proposed changes to the scheme, the Government said the extension would provide the certainty needed for businesses to invest in decarbonisation.
Companies under the scheme are required to obtain allowances for every unit of carbon they emit. These allowances are traded between participants, generating a carbon price that spurs businesses to invest in cleaner or renewable energy sources and improved energy efficiency.
In two consultations, the UK Emissions Trading Scheme Authority has set out proposals to ensure the scheme’s market continues to facilitate cost-effective decarbonisation for the businesses involved. This includes options for a new mechanism to manage the supply of carbon allowances in the market. The consultations also consider support available for energy intensive industries under the scheme.
The world’s largest offshore wind farm is to be built off the East Coast of England.
Hornsea 3, which will have a capacity of 2.9GW, is expected to be completed around the end of 2027. It will be developer Ørsted’s third gigawatt-scale project in the Hornsea zone following Hornsea 1 (1.2 GW) and Hornsea 2 (1.3GW).
In July 2022, Ørsted was awarded a contract for difference (CfD) for Hornsea 3 at an inflation-indexed strike price of £37.35 per MWh in 2012 prices. The CfD framework permits a reduction of the awarded CfD capacity. Ørsted said it will use this flexibility to submit a share of Hornsea 3’s capacity into the UK’s upcoming allocation round 6.
An industry action plan to release enough grid capacity in the next year to decarbonise Great Britain’s power grid have been unveiled by network operators. The Energy Networks Association (ENA) said plans to unlock 139GW of capacity “open the door” to customer projects to fully enable decarbonisation by 2035.
As well as releasing up to 90GW of capacity by cleaning up the connections queue and actively managing a “first ready, first connected” process, up to 70GW of applications will be accelerated by allowing some applicants to connect faster, before enabling works are completed.
Nearly 3GW of capacity will be achieved through network operators changing the modelling and assumptions for storage projects at both transmission and distribution level, to better align with actual usage patterns. A further 46GW of capacity will be released by making network planning processes more coordinated and realistic.
Scottish Renewables has published its response to the Capacity Market 2023 phase 2 proposals and 10 year review.
The Government is asking for views on proposed changes to the UK Emissions Trading Scheme to support progress to net zero. The consultations will run until 11 March.
Elexon is seeking views from BSC parties and stakeholders on its 2024/25 business plan.
Ofgem has launched a consultation to decide the 2026-2031 electricity transmission and gas network price controls. The consultation closes on 6 March.
Energy UK has published a new report, Energy Matters: Across the Economy, featuring a collection of essays from business leaders, community groups and parliamentarians.
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