It’s hard to believe the pace of change that has occurred in the UK in the last few weeks. In just over a month since the outcome of the Brexit vote - now a distant memory - we’ve seen a government fall and rise again under new leadership, an opposition party stuck in civil war and enough economic uncertainty to make any investor think twice about the UK.
The vote to leave the European Union has sent shockwaves throughout the world and while many still question the result and the effect it will have on our future, an immediate effect is set to hit the UK’s renewable energy industry.
As a member state the UK is currently subject to the Renewable Energy Directive (RED), which requires it to achieve a 15% renewable energy target. Of this we are expected to deliver 30% of our electricity from renewable sources, 12% in heat and the binding target of 10% renewable transport.
Considering the boom in solar and other renewable electricity technologies, it’s no surprise that the UK is well on track to achieve the first of these. The recently closed Department of Energy and Climate Change (DECC) released the first progress estimate towards RED last month which showed that 22.3% of total electrical generation was from renewables in 2015 (83.6 TWh). This is thought to have increased to 25% this year.
However, this success has hardly been reflected in renewable heat and transport and in a fairly damning report released in early July, the National Grid concluded: “We believe the progress required in the heat and transport sector is beyond what can be achieved on time.”
“The progress required in the heat and transport sector is beyond what can be achieved on time.”
Even in the National Grid’s most optimistic ‘Gone Green scenario’ in which policy interventions are the driving force behind the transition to a low carbon future, the UK could not meet its goals until 2022.
Depending on who you believe, the jury’s out on which of the two is the more difficult to meet. National Grid’s Future Energy Scenario’s report found that decarbonising the heating sector will prove to be the most challenging, requiring around 60TWh more to meet the target and reach almost three times current levels.
However, with the 10% target for transport being the only binding sub-obligation, slow progress in this area is a key concern. National Grid says a 24TWh increase from current renewable energy in transport is necessary, with DECC claiming that as of 2015 the UK had only reached 4.1% of renewable energy use. Worse still, this 2015 figure is a 0.8 percentage point decrease from the year before. The UK is actually going backwards.
This lack of progression in transport has been the subject of a number of sessions with the Energy and Climate Change select committee, with the most recent meeting of the 2020 renewable energy inquiry questioning members of the government’s transport team.
Andrew Jones, parliamentary under secretary of state at the Department for Transport, was among the witnesses of the investigation and despite his veneer of confidence even he had to admit the scale of the problem.
“We’re all concerned about the agenda and hitting our targets. The issue of reducing carbon in our transport fleet is very important,” he said on 13 July.
Despite the rapid progress of electric vehicles, electrification only accounts for around 1% of the transport target, with biofuels acting as the primary method being used to move towards 2020.
However the government faces serious problems increasing their share in the country as a whole and what’s more, this singular approach is certainly at odds with what needs to achieved, with Jones pointing out: “This is not a question of there is one silver bullet to solve the problem of carbon in transport.”
Dan Poulter, who chaired the last ECC committee session, summed up the problem in his response: “Whilst you say that there isn’t one silver bullet, it doesn’t seem that many of the bullets are going to sufficiently contribute to help deliver that target by 2020.”
The Brexit effect
However, all of these concerns may be completely unfounded following the Brexit vote. Despite Amber Rudd and former energy minister Andrea Leadsom both saying the vote did not represent a downgrading of climate change or the UK’s commitments to tackling it, the possibilities left open by the vote do give Theresa May’s new regime an exit strategy when it comes to 2020.
Speaking alongside Jones and others last week, Lord Bourne – as he often does in select committee sessions – alluded to a worrying government view.
“Until we know precisely how Brexit plays out in terms of the energy union, because there are countries who are part of the energy union that are not part of the EU, it’s difficult to say exactly how this plays outs. But at the moment we’re certainly working on the basis that these remain relevant and binding on the United Kingdom,” he said.
“Until we know precisely how Brexit plays out in terms of the energy union…it’s difficult to say exactly how this plays outs.”
The implication here of course is the phrase “at the moment”, particularly as new secretary of state for exiting the EU David Davis has said his job should be done by 2019. This would leave the UK free from the potential consequences of missing the 2020 targets.
This could be the government line already as the focus has shifted to the UK’s domestically legislated Climate Change Act obligations instead, moving the goalposts to 2050. In response to widespread coverage of National Grid’s conclusions the government’s statement referred only to 2050, which will do nothing to calm the fears of industry when it comes to 2020.
As Jenny Holland, campaigns director for the Association for the Conservation of Energy, pointed out to Inside Clean Energy: “There is considerable concern that unless we get clarification from government, they may feel that by 2020 they will no longer be bound by those targets and therefore stop meaningfully working towards them in the interim.
When asked, a government spokesperson only said: “We continue to make progress to meet our overall renewable energy target.” Hardly the ringing endorsement of 2020’s targets that industry is calling for.
This story originally appeared in Issue 1 of Inside Clean Energy magazine. Fill out the form below to download the entire issue for free.