Smart, flexible power system could save consumers billions, government told

The adoption of a smarter, more flexible power system in the UK could save consumers billions and make the most of future renewable electricity generation, the government has been told.

In its first report since being established last September, the National Infrastructure Commission has this morning told government that an energy system based largely on greater interconnections with Europe, world-leading storage technologies and greater demand flexibility could save consumers as much as £8 billion a year by 2030.

The Commission’s ‘Smart Power’ report also claims that the measures would help the UK meet its binding 2050 carbon targets and produce a more secure energy supply, comprising substantial renewable generation to replace aging fossil fuel-powered sources.

It recommends a number of priorities that the government should pursue over this parliamentary term, including additional interconnectors with European countries, the removal of regulatory barriers preventing storage deployment and government support of demand flexibility programmes.

While renewables plays a central role in the strategy, storage is the technology to feature most prominently and plays a central role. The Commission has said that government must launch a review of storage’s legal status by Spring 2017 at the latest and implement any necessary changes as soon as possible.

But the report stops short of recommending subsidies to promote the adoption of storage as Germany has done with some success, instead insisting that greater deployment can be achieved without financial incentives.

The Commission argues that the deployment of storage makes most sense “where it is linked to onsite power generation”, citing rooftop solar as a particular example.

While the Commission has not explicitly recommended that renewable sources be supported by the government, it does however state that wind and solar will generate a greater proportion of the UK’s electricity in the future.

The report cites two particular models created by the government – ‘Going Green’ and ‘Consumer Power’ – which forecast solar capacity of 23.3GW and 29.1GW by 2030/31 respectively.

These figures fall broadly in line with the asks within the Committee on Climate Change’s fifth carbon budget which recommend solar capacity of between 20 and 40GW by 2030, but hint towards strong deployment throughout the 2020s if DECC’s most recent 2020 solar forecasts of 13GW are to be considered accurate.

Strong renewables deployment would, according to the NIC, open up the potential for a much stronger energy trading network with continental Europe through further interconnectors. The report contains scenarios in which interconnectors could be used to “smooth out” the effects of weather patterns on generation and help ease energy price volatility they create.

The UK could in particular reap more solar power than Scandinavian countries in the summer months, and more wind power than southern European countries in the winter.

The Commission also wants to see the government support more demand flexibility schemes and in particular cited the ongoing ‘Sunshine Tariff’ trial in Wadebridge, north Cornwall, managed by RegenSW and Tempus Energy. Further trials of a similar nature, including potential pilot business models supported by DECC, could be forthcoming.

The report has been largely backed by industry, particularly the Institution of Mechanical Engineers (Imeche) which strongly endorsed the adoption of more flexible demand systems.

But Imeche has warned that not enough is known to encourage them at the moment. “With any new innovation there is a time and cost associated with connecting to incumbent infrastructure, including the development of new skills, supply chains and the transition to smart devices. Specifically there is a need for further research into the security of internet managed energy systems where resilience is essential,” Jenifer Baxter, head of energy and environment at Imeche, said.

Frank Gordon, senior policy analyst at the REA, also welcomed the report’s findings. “Energy storage is ready to deliver a huge range of benefits to the UK as the findings make clear. What’s really exciting is that no one is calling for a new subsidy for energy storage, only common sense changes to existing policies,” he added.