The Prime Minister declared a commitment to decarbonise electricity by 2035 this week, which is a hugely welcome step and reflects advice from the Climate Change Committee. We, and the whole industry, stand ready to deliver on this commitment, but we still need the government to remove barriers which remain in the way of a fast and efficient rollout of new solar and wind farms.
There is a huge opportunity to move away from a centralised energy system reliant on fossil fuels to a modern, smart, flexible grid which generates electricity close to where it is used and gives people control over when and how they use it. In order to achieve this, a number of changes need to happen:
- National Planning Guidelines will need to be updated further to reflect the climate emergency.
- More ambitious targets must be set for onshore renewables, backed up by a further long-term commitment to Contracts for Difference, the government auctions which set a base price for wind and solar.
- The energy transformation will involve significant changes to the wholesale market. Prices will need to reflect the cost of capacity (ie the amount of renewables and storage needed to run a zero carbon electricity grid) rather than being artificially tied to the cost of gas generation. In the long term this transformation will enable the consumer to make more informed choices about how they use electricity, leading to lower, more predictable prices.
The cost crisis in the energy sector shows that we need ambitious government targets to increase renewable generation and storage capacity to meet our future energy needs. Gas prices hit a record high yesterday. Fluctuation like this doesn’t come as a huge surprise – it certainly isn’t the first time that the UK has fallen victim to volatile fossil fuel prices and probably won’t be the last if we continue on our current trajectory. Using renewable sources of electricity is the best way to provide the stability we need as they are not subject to the same market issues.
Renewables are fundamentally different to fossil fuels because the ‘fuel’ - i.e. sunshine and wind - is free. This means costs are stable and predictable as they are dominated by the initial capital expenditure; but these resources are also naturally variable. So, it’s vitally important that we are more conscious with our consumption and invest in technologies such as battery storage, ensuring that we have a flexible energy system that can cope with this variability to balance supply and demand. Countries which scale up their transition to clean energy will be much more resilient to these shocks in future.
At Thrive, we invest directly in the future of the UK energy system. Five new projects were added to our pipeline in 2020 across of a range of technologies including solar, hydro and battery storage, plus the UK’s first deep geothermal electricity generation plant at United Downs in Cornwall, which once constructed will supply clean electricity 24/7. It has also recently reported high levels of lithium in its geothermal waters – a step forward in the race to locally and responsibly sourced, low carbon lithium and an essential component for the UK’s move towards electric vehicles.
We have recently invested in building two battery projects – a 20MW project at Feeder Road in Bristol and a 5MW project outside Milton Keynes. Battery storage projects like these will enable further deployment of wind and solar generation, while our hydro and geothermal projects will provide more baseload renewable electricity. Together these types of technologies will provide the backbone to the resilient, renewables-dominated electricity grid the country needs if we’re to mitigate the worst of the climate crisis.
While the gas supply issues saw the government come together for crisis talks around protecting consumers, it will be interesting to see how it plays into Boris Johnson’s address at the COP26 summit in November. Everything is pointing towards the acceleration of clean energy to end our reliance on fossil fuels, but we will require greater government support to back up headline catching speeches and ensure that we can scale up renewables at the pace and scale needed to reach net zero.
In anticipation of one of the most important climate summits to date – COP26, keep an eye out for our weekly blogs where we’ll be exploring how a net zero energy system will benefit consumers, business and the country as a whole.