27 April 2012

Kari Williamson

In connection with the Clean Energy Ministerial held in London this week with energy ministers from 23 leading economies, the UK has highlighted a string of investments in renewable energy.

UK Prime Minister David Cameron, says: “There are huge challenges facing governments across the world today,a nd one of the most important of all is how we meet our growing energy demands in a way that protects our planet for our children and grandchildren.

“With global demand forecast to increase by more than 40% in the next two decades, we urgently need a more diverse, cleaner mix of energy sources that will give us energy security without causing irreparable damage to the planet.”

£350m in investments

In addition to the £4.7bn of investments, there has been a recent flurry of activity in the UK renewable energy sector with industry announcements amounting to over £350 million, which could lead to 800 jobs during the peak of construction (see box 'Investment flurry').

There have also been several government announcements, including:

Investment flurry There has been much activity in the UK renewable energy sector recently with a string of investments being announced. E.ON has announced a cable installation contract for 30 km of cable to UK's Balfour Beatty for the Humber Gateway offshore wind farm;

Eneco and EDF Energy are forming a joint venture (JV) to develop the Navitus Bay Offshore Wind Project west of the Isle of Wight;

JDR Cables, which provides subsea cables and umbilical systems for offshore oil, gas and renewables, has invested a further £30m in its Hartlepool plant to meet growing demand;

Helius Energy is working with a club of banks to project finance its 100 MW, £300m Avenmouth biomass project at the Port of Bristol;

ECO2 (Lincs) will shortly begin construction on its 38 MW Sleaford Renewable Energy Plant – a straw-fuelled biomass combined heat and power (CHP) plant expected to become operational in 2014; and

Banks Renewables has entered into a £21.9m funding agreement with The Co-operative Bank for its 20.4 MW Penny Hill wind farm near Rotherham. A number of supply and construction contracts will go to local firms, and the towers will be manufactured by the UK's Mabey Bridge.

Desertec for the North Sea

In addition to these, Cameron has announced a new industry partnership similar to the Desertec solar initiative, except this one is focusing on North Sea renewables.

Norstec already counts 20 firms from several countries with an interest in creating a renewable energy power centre in the North Sea. It consists of major offshore wind developers, manufacturers and supply chain companies.

The Norsetec network will come together to discuss how the partnership with operate at RenewableUK's offshore wind conference in June.

Signatories are: Alstom, Areva, Balfour Beatty Utility Solutions, David Brown Gear Systems Ltd., Dong Energy, E.On, EDPR, Fluor Ltd., Gamesa, Harland and Wolff, JDR Cables, Mainstream, Modus Seabed Intervention Ltd., National Grid, Parsons Brinckerhoff, PMT Industries Ltd., Prysmian Group, Renewable UK, REpower, Repsol, Scottish Power, Scottish & Southern Electric, Siemens, Statkraft, Statoil, TAG Energy Solutions, Vattenfall, and Vestas.

Wind at £100/MWh

The Prime Minister also says the Crown Estate and the offshore wind industry, through the Cost Reduction Task Force, is looking into reducing the cost of offshore wind to £100/MWh by 2020.

To support this a second round of offshore wind innovation funding of up to £5m targeted at technology innovations has been set to open for bids in May.

Furthermore, the Crown Estate will explore whether offshore wind test sites can be set up in even deeper water than currently available.

Trading renewables

Renewables trading is another are being looked into, and a Call for Evidence has been published to identify the potential of, and better understand, benefits and risks to the UK in renewables trading.

In addition to fulfilling the potential capacity of delivering 15% of energy from renewable sources by 2020, the UK Government wishes to look into the potential to work with European partners on renewable energy deployment. This could lead to the UK being able to export renewable energy when there is a surplus, or import when needed.

Biomass and bioenergy

A Bioenergy Strategy published this week shows that sustainable bioenergy could contribute around 12% of the UK's total primary energy demand across heat, transport and electricity by 2050. The strategy aims to ensure that the biomass push benefits businesses and consumers at the same time as maximising environmental benefits.

An additional report by the UK's National Centre for Biorenewable Energy, Fuels and Materials predicts that an increase in energy sourced from biomass for electricity and heat could support 35,000-50,000 jobs by 2020.

There has also been an announcement from Aberystwyth University Institute of Biological, Environmental and Rural Sciences that it will work in collaboration with industry to develop an integrated Miscanthus breeding platform with the aid of Government funding.

Energy to poorer nations

David Cameron finally highlighted UK efforts to bring renewable energy to developing countries. The Department for International Development (DfID) will support private companies bringing sustainable energy to some of the poorest countries in Asia and Africa. For every clean cooker sold or new customer connected to a renewable energy powered local grid, companies could receive a top-up from DfID. The aim is to help 2.5 million gain access to clean and renewable energy.

In addition, the UK is funding the development of new partnerships and capacity building activities around carbon capture and storage (CCS) in emerging markets with £60m from the Spending Review.