Analysis: renewables still off-target
Renewable energy is in the spotlight, but urgent action is needed to turn aspirations into achievements.
It was with the damning views of a backbench committee ringing in his ears that Business Secretary John Hutton unveiled the government's consultation on UK Renewable Energy Strategy last week.
The House of Commons Innovation, Science and Skills committee had criticised the government for failing to provide cohesive strategies that would enable the UK to meet its renewables target under the EU 2020 directive. Although the weighty consultation did provide some clearer direction, as is often the case it ended up providing more questions than answers.
In fact, the government itself expressed strong doubts about its ability to meet the mandated targets. The reports says: "If all the options set out in this document were successfully implemented (and if no cost constraints were applied in deciding measures we should take), our scenarios suggest that it will be possible to reach 15 per cent renewable energy in the UK by 2020. This is at the very top end of the range of possible outcomes and would require a very rapid response from suppliers, with a step change in the rate of building renewable technologies."
Worryingly, it is already looking towards trading with other EU states. This means that the UK could fund renewable projects in low-cost countries at a fraction of the cost of doing so at home, and have that energy saved count towards the UK target - significantly reducing the cost of implementation.
The document also suggests energy demand will have to be reduced if the target is to be approached. There are already a range of measures in place to reduce energy - EU Emissions Trading Scheme, the Climate Change Levy, and Climate Change Agreements - but added to that will be the Carbon Reduction Commitment, to be introduced in 2010, which will mandate trading schemes for large non-energy-intensive businesses and public sector organisations.
The scale of the challenge facing the UK is daunting, and some would even say insurmountable. To meet its 15 per cent contribution to the EU 2020 target the UK must increase its share of renewables in the energy mix from its current 1.5 per cent to 15 per cent. That includes electricity, heat and transport. With transport and heat likely to fall well short of the target, the burden will rest squarely on the shoulders of the electricity generation sector. Various targets have been bandied around: the report suggests 32 per cent, but many commentators expect the burden to be closer to 40 per cent.
The fact that the government recognises the scale of the task at hand is reflected by the wording in the report, which is peppered with phrases like revolution, drastic change and far-reaching strategies.
It will be little short of a revolution if it is to succeed.
Speaking at a low-carbon economy summit in London, Prime Minister Gordon Brown said that in the face of an oil shock bigger than that seen in the 1970s, a long-term strategy was needed to reduce dependence on fossil fuels and switch to renewables and nuclear.
Brown said the plans to boost renewable power, which he described as "the most drastic change in energy policy since the advent of nuclear power", would provide 160,000 'green collar' jobs.
A change to a low-carbon economy would require new lifestyles in the UK, along with innovation and creativity - and real leadership from government, he said. Brown insisted he wanted to ensure the costs for families and businesses remained affordable, with a focus on keeping prices down.
The Renewable Energy Association, which represents the country's major renewable energy producers and users, welcomed the breadth of the strategy document, but was alarmed by the lack of urgency.
"Government have produced an energy strategy, not just an electricity strategy," said REA executive director Philip Wolfe. "This shows a new maturity in approach; getting away from the 'soundbite policy-making' of the past and looking carefully at the role of renewables in buildings, heat, and transport. Of course bulk renewable power generation will be the largest part of the answer, but there is much more that renewables can, and must, contribute."
However, Wolfe warned: "The industry has a very short space of time with which to meet challenging targets. There are still gaps and anomalies that need to be addressed. The key missing factor is a greater sense of urgency. We have only 12 years left and government still wants to use two of those talking about it. It has a gold-plated opportunity in this year's Energy Bill to start work on obvious measures such as tariffs for smaller renewables, the regulator's remit and priority grid access. It should also be aiming to complete its action plan this year, not in 2010."
Windy way forward
While the government avoids picking winners, it does say that it expects the key growth areas to be the current commercially available technologies such as onshore and offshore wind along with biomass. Less-established technologies such as marine power may have a part to play over the longer-term.
With the prominence that its technology received it was no surprise that the report gained fulsome praise from the British Wind Energy Association (BWEA). "The measures outlined could transform the UK's energy supply, with wind leading the way," said Maria McCaffery, BWEA chief executive. "This could be a route map for a green energy revolution."
However, she echoed the thoughts of Wolfe on the timescale. "Time is running out to take real action and to plug the UK's looming energy gap - only swift action to unblock the planning regime and fix the grid will allow us to reach the targets on time," she added.
The strategy will provide fresh impetus to the industry's investment plans, with 19GW worth of schemes already in the system at one stage or another of development, including nearly 7GW either approved or actually under construction.
Industry analysis of wind schemes already within the system shows that by 2013 installed wind capacity should overtake installed nuclear capacity in the UK with over 8.5GW operational. By 2015 there will be 6GW of wind operational offshore alone. From 2015 the next generation of offshore wind farms will start to come online, delivering up to 20GW of offshore wind schemes by 2020.
The strategy also highlighted the economic potential of expanded wind power, with a new government study accompanying the strategy indicating that 160,000 additional manufacturing jobs would be created by having 33GW of offshore wind.
"Government and industry now need to work together to ensure that the majority of these new jobs are based in the UK," McCaffery commented. "Getting this strategy has been a hard-won victory for the wind industry but at last the government has woken up to the potential represented by renewables. This is a big step forward. The government is saying yes to wind and we give the strategy a thumbs-up; however, words will not be enough - now we have to deliver this strategy with decisive action."
Heating in demand
At present, heating accounts for the largest single proportion of the UK's final energy demand, at approximately 49 per cent, and also the largest portion of carbon emissions at 47 per cent. Increasing renewable heat is therefore crucial for delivering the UK target.
The trouble is that deployment is currently at a very early stage: less than 1 per cent. As heat cannot be transported economically over distances, this generation is necessarily decentralised and local. The fragmented nature of the heat market means that it is difficult to develop renewable heat policies that encourage efficient and cost-effective use of these technologies.
The main increases in renewable heat in the UK are likely to come from biomass-based technologies and micro-generation, such as solar water heating and ground- and air-source pumps.
The strategy was broadly welcomed by environmental groups such as Greenpeace and Friends of the Earth, who said meeting the EU target would create a clean and secure energy supply and jobs.
But Friends of the Earth energy campaigner Robin Webster said there were "worrying gaps" in the plans, while Greenpeace's executive director John Sauven said ministers needed to get serious about cutting energy waste from buildings, appliances and cars.
As ever the nimbyism that has plagued renewable growth came out shouting loudly with the Campaign to Protect Rural England (CPRE) warning that the landscape should not be sacrificed to tackle climate change.
The National Trust's Tony Burton said it would mean far-reaching changes to the UK's homes, countryside and seas and securing public consent would demand greater respect for the local environment and local communities.