28/10/2021 | Green hydrogen

New policy paper shows flexible clean energy system benefits consumers

28 October 2021 - RenewableUK press release


RenewableUK has published a series of recommendations in a new policy paper on how to build a more flexible modern energy system which maximises the benefits of renewables for consumers.


The document, entitled “Net zero will only be possible if we realise the full potential of flexibility”, sets out how the UK can decarbonise further and faster by harnessing innovative technologies to deliver a more efficient system based on high levels of renewable and low carbon generation.  


It states that flexible technologies are vital to meeting the Government targets, including integrating 40GW of offshore wind, 5GW hydrogen and 18GW of interconnector capacity onto the system by 2030. These will play vital roles to support the way in which the grid functions in the future.


Energy storage technologies offer a high level of flexibility and capacity is scaling up fast in the UK with a pipeline of 16GW, enabling us to store surplus electricity and use it when demand is high, using lithium-ion batteries and other innovative storage technologies.


Generating green hydrogen using electricity from offshore wind offers another flexible source with a wide range of uses including heating and transport, where progress towards decarbonisation has so far been slower than in the electricity sector.


Consumers can participate by charging up electric vehicles and feeding power into the grid when needed. The transition towards local energy markets is starting to get underway and increasingly these markets will enable us to decarbonise faster. Microgrids will help to manage local production and consumption better and alleviate constraints on the main grid.


Renewables can also provide services to the grid such as frequency response; fine-tuning the amount of power generated so that supply meets demand at all times. The industry is working with National Grid to ensure more renewable generators can enter these markets.


Key recommendations in the paper include ensuring that the way in which the energy market is regulated accelerates the transition to a smart, flexible, low carbon energy system. The key benchmark should be that all flexibility markets and services contribute to achieving the UK’s net zero target. Increasing carbon signals in flexibility markets will incentivise investment in low-carbon technologies. A common approach to carbon pricing across all markets would drive the transition from fossil fuel-dominated balancing markets to low carbon flexibility services.


The paper also calls for a fair approach to network charging for electricity generators and zero or low carbon flexibility providers for access to the grid. At the moment there are stark anomalies across the market with much higher charges imposed by Ofgem on generators in some parts of Scotland for example. For decades, transmission charges have penalised generators for being connected in remote locations, but this is now where many are based as they have the best wind resources. The industry needs greater assurances from Ofgem that any reform to the network charging arrangements will provide a more stable long-term environment which supports growth in the provision of flexibility in areas of network congestion as well in areas of high demand. 


The paper’s author, RenewableUK’s Senior Policy Analyst Yonna Vitanova, said:


“Flexibility is about more than simply making the transition to clean energy faster – it also makes it cheaper and more reliable. That’s good news for consumers who have been hit hard by the massive increase in gas prices.  


“To maximise the benefits of flexible technologies and to reach net zero emissions as quickly as possible, Government policy, regulation and markets need to provide a stable and transparent platform for us to generate clean power in the most efficient way.


“The industry strongly supports the Electricity System Operator’s commitment to being able to operate the National Grid at net zero by 2025. This paper sets out some of the key principles to achieve this”.   


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Notes


RenewableUK’s members are building our future energy system, powered by clean electricity. We bring them together to deliver that future faster; a future which is better for industry, billpayers, and the environment. We support over 400 member companies to ensure increasing amounts of renewable electricity are deployed across the UK and to access export markets all over the world. Our members are business leaders, technology innovators, and expert thinkers from right across industry.


The policy paper is available in RenewableUK publications. 


RenewableUK’s events programme is available here.


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