The transition to net zero is the biggest energy industry transformation in 50 years. The UK, however, is not doing enough to navigate the tumultuous waters of this upheaval.
To meet its targets, the incoming UK Government will need utility-scale investment from the private sector for grid improvements and new low-carbon power generation. National Grid says it needs to invest £60bn ($76.62bn) over five years to be on track; currently, it is sitting on not even 10% of that capital.
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To compete for investment on the international stage, the UK needs to offer certainty: a prolonged period of stable and certain policies implemented to stimulate grid investment as well as renewables growth and ownership.
Policy recommendations
First, the incoming government must initiate policies across the board that are pro-renewables and fall in line with public support for the cause that exists across voters of all political persuasions.
The new parliament’s policy priorities should include streamlining the planning process for onshore wind and solar PV by providing national standards proportionate to the scale of the development. PEP Renewables would welcome the removal of the planning block on onshore wind turbines in England. Wind power is not only cheap and popular with the majority of the public, but can be deployed quickly with the right regulatory framework in place.
Additionally, PEP Renewables recommends setting national planning and environmental processes for the development of renewables-to-hydrogen projects.
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By GlobalDataIt is also critical to restructure the requirements of Electricity System Operators such as National Grid, Scottish Power and SSE, as well as Distribution Network Operators to provide fast and transparent connection procedures.
On the financial side, PEP Renewables suggests grandfathering government support scheme rights at the project level to remove investment risk.
Lastly, encouraging ownership of renewable energy projects by companies for their own use through tax breaks can result in a win-win scenario for both businesses and the environment.
Why renewables ownership is the way forward
Grid-scale change will take many years, during which we are likely to see a shortage of green energy and higher costs.
However, the industrial and commercial sector can deliver company-scale change now by choosing to own and operate renewables either on or near-site (within 10km).
Ownership of renewables can deliver for businesses secure, green electricity and Renewable Energy Guarantees of Origin that are greenwash-free. This green electricity can be used to power, heat and refuel transport, among other areas, for businesses, turning each company’s energy transition goals into actions.
Onshore wind and solar PV pay back the carbon used to construct the projects in around a year, then produce zero-carbon electricity at around a third of the cost of Hinkley Point C for 25 years or more. Furthermore, they can be developed and built more quickly than projects such as Hinkley.
The policy recommendations made above would provide the impetus for many more businesses to own and operate on-site renewables.
Owning the means of energy production gives companies control over their energy supply, security and costs, boosting profits, providing essential energy security and allowing businesses to implement a genuine plan to deliver on net-zero goals.
This election is a once-in-a-generation opportunity to address the transition to net zero with long-term cost and energy security benefits for businesses. This change must start by providing policy and regulatory certainty.
About the author: Bruce Woodman is managing director of PEP Renewables, a group of clean energy specialists with more than 25 years in the renewable energy space helping businesses to own renewables for access to secure, long-term, low-cost energy.
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