UK Government Energy Projections Increase Role Of Renewables, Still Behind 2030 Carbon Budget

March 27th, 2017 by Joshua S Hill

New official energy projects published by the UK government this month have surprised many, giving un-looked-for credence to the importance the renewable energy industry can have on the future of electricity network in the United Kingdom.

Specifically, according to the Institute for Energy Economics and Financial Analysis (IEEFA), the new Department for Business, Energy and Industrial Strategy (BEIS) projections show a 2025 electricity network dominated by renewable energy and electricity imports — imports which IEEFA analysts believe bolster the idea that regional interconnection can play a vital role in achieving a low-carbon transition for the UK.

However, even though the new government projections include significant reductions in new gas capacity and increased levels of renewable energy with much cheaper prices. According to Carbon Brief, this “consequential change” seems to suggest that the UK government is finally beginning to listen to what the rest of us have known for some time now — that renewable energy technology is only going to continue to fall in price as the years pass by, making it a much more attractive option. Carbon Brief points to a November BEIS report which it says “cut the cost of wind and solar power by 15-30%, both now and in the future.”

These changes have been integrated into the BEIS energy projection model, which also fine-tuned the reality of whole-system costs of integrating variable renewables into the grid.

As a result, the model now predicts new renewable energy capacity is projected to reach 36 gigawatts (GW) by 2030 — 71% more than the 21 GW of new build capacity which was projected in the 2015 BEIS energy projections report. While the report does not break down new renewable energy capacity by type, Business Green says it includes 10 GW of small-scale subsidy-free solar by 2030. The BEIS is also now including an increased role for battery storage, with capacity reaching 3 GW in 2030 and 4 GW in 2035.

Meanwhile, the projections also include 20 GW of interconnection by 2025, up from the 4 GW currently in play. This comes as something of a surprise — not least of all because of the somewhat measly current 4 GW. IEEFA, in a report published earlier this month, suggested the role of interconnection in the UK future electricity mix could reach 12 GW by 2025. According to the IEEFA, the new BEIS projections “seem to assume the completion of more speculative projects, such as a proposed link to Iceland, and its projections are a sign that indeed a more regionally interconnected grid is on the way.”

In fact, it appears as if the new BEIS projections go a long way to assuaging many doubts — though according to Carbon Brief, the UK is still behind on its carbon budget targets through to 2030. Specifically, Carbon Brief reiterates the long-held belief that the UK will fall short on its fourth and fifth carbon budget goals, for the years 2023 through 2032. This is backed up by the BEIS’ own comments:

“There are projected shortfalls for the fourth carbon budget of 146 MtCO2e (range: 103-236 MtCO2e) and for the fifth carbon budget of 247 MtCO2e (range: 207-354 MtCO2e).”

However, as the following IEEFA charts show — the first depicting IEEFA’s estimates for growth in the sector, and the second showing the projects made by the BEIS — it’s not all doom and gloom.

IEEFA: Projected generation and net imports, through 2025 (GWh)

BEIS: Projected generation and net imports, through 2035 (TWh)

“The BEIS projections seem also to play down the energy department’s capacity market bias,” said Gerard Wynn is a London-based IEEFA energy finance consultant. “Its projections see a big decline through the 2020s in two of the main generation technologies presently supported by the scheme, that is, coal and gas. The BEIS sees the main growth in technologies that can be privately funded, such as new interconnection, or supported under other schemes such as renewables and nuclear power.”











Appreciate CleanTechnica’s originality? Consider becoming a CleanTechnica member, supporter, or ambassador — or a patron on Patreon.

Sign up for our free daily newsletter or weekly newsletter to never miss a story.

Have a tip for CleanTechnica, want to advertise, or want to suggest a guest for our CleanTech Talk podcast? Contact us here.

Latest Cleantech Talk Episode