In August the National Infrastructure Commission (“NIC”) published the results of new modelling research it commissioned on the potential impact on renewable targets of the fall in the cost of generating renewable energy. Entitled, “Renewables, Recovery and Reaching Net Zero”, the research, carried out by Aurora Energy Research, states that 65% of Britain’s electricity could be sourced from renewables by 2030 without a material change in cost either in the short or long term. This compares with the NIC’s previous recommendation that 50% is delivered from renewables by 2030. Currently some 40% of Britain’s energy is generated by renewable energy.
What is the the National Infrastructure Commission?
'The NIC was set up to provide impartial advice on major infrastructure to the Government. Its remit includes all sectors of economic infrastructure but excludes social infrastructure such as housing, schools, hospitals and land use. The Commission, whilst independent and free to determine its programme and the content of its statements operates within certain fiscal and contextual remits:
- Its recommendations for infrastructure have to be consistent with gross public investment of between 1.0 and 1.2 of GDP each year between 2020-2050
- The NIC is to take into account the role of the relevant regulators of infrastructure providers
None of the NIC's recommendations is to reopen decision-making processes once governmental decisions are made.
Last month’s report by the NIC considered the total system cost of delivering a net zero electricity system up to 2050 rather than the costs of each technology. An electricity system that balances supply and demand for each half hour of the year was, therefore, modelled. The costs included in the report were those relating to construction, connection and operation including wider system impacts.
The models considered systems with 60, 80 and 90 percent renewable make up in 2050 but all assumed a 65% of renewable generation in 2030. The report states: “Across all modelled scenarios between 86 and 99 GW of renewables must be deployed by 2030 to deliver an electricity system with 65 per cent renewable generation”. These figures were broken down as 40GW of offshore wind, 14-18 GW onshore wind, and 29-38 GW of solar.
The NIC was keen to point out that the analysis is robust to future uncertainty that includes not making optimistic assumptions on future renewable cost reductions and not considering the roles that hydrogen or carbon capture may play in the future.
One further view of the NIC that mirrors our experience was on development and construction times: offshore windfarms can be built in around eight years, inshore wind pre-development and construction is around six years and solar is approximately one year.
What is the industry’s response to the report?
Unsurprisingly, RenewableUK (the trade association for wind power, wave power and tidal power industries in the United Kingdom) has welcomed the NIC’s recommendation but questioned whether the NIC’s suggested 65% target could be even higher. RenewableUK has also urged the Government to remove the cap on the amount of new renewable energy capacity in their contracts for difference auctions.
In their comments welcoming the report, the Energy Networks Association also highlighted their continuing Open Networks project and the need for smarter, more agile networks.
The report is welcome and the analysis is certainly encouraging in terms of the approach to increasing renewable penetration in the electricity market by 2030. It may seem churlish to criticise a good news story but despite the headline given to the report, the analysis does not adequately touch on the much more complex goal of reaching Net Zero by 2050. The publication has generated some overly optimistic headlines. The public would benefit from seeing the report’s recommendations
- in the context of the NIC’s other research on other technologies and
- (ii) in terms of a view of the position of other sectors progress or otherwise to net zero rather than simply dealing with two technologies within electricity generation.
Future reports would also benefit from including the modelling within the main document.
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