The House of Lords Industry and Regulators Committee has warned the UK government that without urgent action, the nation is in danger of missing its targets for grid decarbonisation by 2030.
The report, titled Power struggle: Delivering Great Britain’s electricity grid infrastructure, was compiled from evidence received from 22 expert witnesses from across the energy sector, including Solar Energy UK CEO Chris Hewett, as well as 52 written submissions including from battery energy storage system (BESS) developer Zenobē Energy, BESS investor Gresham House, and solar developer Low Carbon.
The report notes that in order to meet the 2030 target of having a 95% decarbonised electricity grid, “far more electricity generation and network infrastructure will need to be built and at a much faster pace than Great Britain has managed in recent years”, noting that doing so will require long-standing issues in planning and regulatory approvals processes to be resolved, and rapidly.
The committee has suggested that the government should publish key metrics relating to the delivery of the 20230 clean power targets every six months, noting that it believes that “parliament and the public should be able to see the progress being made” in real time. According to the committee, these metrics should include reporting on the amount of electricity generation that networks have connected to the grid and progress on key transmission projects.
Solar industry raises concerns
Notably, the committee has come out in favour of zonal pricing, a highly-contested proposal in the energy sector, suggesting that zonal pricing could enable better use of existing grid capacity and reduce the amount of upgrade works that need to be completed.
However, Solar Energy UK CEO Chris Hewett urged caution regarding zonal pricing, noting that investors in the solar sector have some concerns about the uncertainty a new pricing system may bring. Hewett noted that investors are “cautious about the benefits of zonal pricing” and are in a position where they can “move their money [out of the UK] very quickly”.
Furthermore, the report highlights concerns from the solar energy and battery storage sectors that grid queue reforms could target the wrong projects, with Hewett commenting that “there are perfectly good projects that are likely to go ahead that are being told they are not needed, being called zombies when they are not”.
As such, the committee has stated that: “in preparing the Strategic Spatial Energy Plan, NESO must consult closely with all stakeholders, including the solar and battery storage sectors”, ensuring that there is “an open and constructive dialogue which builds confidence in the future investment prospects of these industries”.
Chair of the Committee, Baroness Taylor of Bolton, issued a stark warning in response to the findings of the report, stating: “Time is already running out, and there is no room for complacency. The government and the sector must ramp up their efforts to have a chance of success.”
Sam Hollister, head of energy economics, policy, and investment at analytics firm LCP Delta, noted that the firm’s own analysis has found that around £120 billion of capex investment will be needed to meet 2030 clean power targets.
Hollister added: “Overhauling hurdles in the planning process and providing greater clarity to investors and developers are two of the biggest missing parts in the clean energy puzzle. These are necessary to successfully mobilise the low carbon technologies required to decarbonise the UK’s power system and bring down energy bills in the process.”
Kelly Becker, president of Schneider Electric UK and Ireland, Belgium and Netherlands, stated that meeting the UK’s clean power goals will require “bold leadership and a coordinated approach to maximising renewable energy”, which Becker notes will necessitate urgent investment in grid infrastructure. Becker added: “Targeted measures are essential to reduce electricity costs and incentivise the adoption of clean energy technologies.”
