The Solar Trade Association (STA) has hit out at government’s newly announced gas strategy over concerns that a ‘dash-for-gas’ scenario threatens the meeting of the binding 2020 renewable energy targets.
The STA shares the view of the Committee on Climate Change (CCC) whose Chief Executive, David Kennedy, said of the announcement: “The gas-generation scenario includes a scenario which reflects a new dash for gas, with very limited investment in low-carbon technologies through the 2020s. This would not be economically sensible, and would entail unnecessary costs and price increases. Neither would it be compatible with meeting carbon budgets and the 2050 target. Early decarbonisation of the power sector should be plan A – and the dash for gas Plan Z.
“Including these very different investment paths in the strategy exacerbates mixed signals already given by the Government and is damaging for the sector investment climate.”
During the announcements yesterday both the Chancellor and the Prime Minister claimed that the Energy Bill had given the renewables industry the certainty that investors had long been craving. However, the STA points out the solar industry is still enveloped in uncertainty with no decision over Renewable Obligation (RO) banding levels for large-scale solar.
STA Head of External Affairs Leonie Greene said: “The Chancellor and the Prime Minister are wrong to claim that renewable energy has a 'very clear and stable framework'. We are still seeking stability under both the Renewables Obligation (RO) and Electricity Market Reform (EMR) for solar power. Clarity is urgently needed – not least because solar power is set to be a lot cheaper than gas with CCS in the 2020s.”
The Gas Generation Strategy document states that 37GW of new gas capacity could be in place by 2030, yet DECC’s own modelling shows that only 13GW of the proposed 37GW would be compatible with the CCC’s recommendation of a 50g/kWh CO2 target. Buried deep within the Gas Generation Strategy is a graph (image 2) which is a major concern for the STA. The graph shows that after the next round of new nuclear plants come online in the 2020s, renewables' share of the ‘Diversified Energy Mix’ appears to stagnate.
STA Solar Specialist Ray Noble added: “The Treasury is fixating on the wrong technologies. The UK needs a dedicated Solar Power Strategy. If government is serious about tackling climate change, answering the looming energy crunch and seizing huge economic opportunities, it needs to vigorously back solar technology.
“It is particularly disturbing to have this unconventional gas push announced as nations struggle to hammer out a desperately needed global agreement on preventing dangerous climate change.”
Greene concluded: “Whatever the Chancellor's plan for gas, solar will come into its own in the next decade as households increasingly choose to supply themselves with solar power without subsidy. It is ironic that the Treasury has a poor grasp on the relative cost of energy generation technologies in the next decade. It makes no sense whatsoever for the public to invest in building a strong renewable power industry this decade only for government to plan for precious little growth in renewables in the next.
“We hoped the Gas Strategy would leave no room for doubt that Government will ensure investment in gas must complement the delivery of the binding 2020 renewable energy targets. That is not the case and it begs the question if Government is running two parallel energy strategies, and the extent to which they are in competition. With the loss of the Renewables Obligation and no emission performance standards for unabated gas for decades, there is no reason why utilities should invest in renewables rather than gas.
“The Government should urgently prioritise sorting out the policy framework for renewables, because investment is floundering. Instead it seems to be putting huge resources into promoting fossil fuels, while solar is subject to repeated policy delays.”