From the revised projections made by BEIS, it has been predicted that:
• Low-carbon sources of electricity that supply the UK will grow from 68% in 2016 to 86% by 2035
• There will only be 1GW in use of carbon capture and storage by 2035
• Renewables will expand rapidly from 36GW in 2016 to 45GW by 2035
Overall these projections appear to be positive with renewables approaching a 50% share by 2035. However, retroprogressive UK energy policy moves have already had a great negative impact:
• Onshore wind (cheapest renewable options) is blocked by government policy. It can’t apply for Contract for Difference (CfD) slots, which allows investment to come forward at a lower cost of capital, and planning rules have been tightened to suppress onshore wind.
• PV solar growth has also been constrained, with small projects being denied Feed-in Tariffs (FiTs) that enable ordinary energy users to be paid for the renewable electricity they generate and large projects being denied access to CfDs.
These moves have already had a big impact: UK investment in wind, solar and other renewable sources slumped last year by 56% to £7.5bn, while worldwide spending climbed by 3% to £242.4bn, the second-highest level on record.
Looking ahead, this situation may get worse for all renewable with levy support being frozen until after 2025 to avoid levy costs being past to consumers. With technology costs falling, some projects may of course still go ahead without CfDs, but the rate of expansion will be less than it would have been with the support in place. And new, currently less developed, projects will stand much less chance of getting established on the path to falling costs.
The problem we face now is that, given current policies, some sources of renewable energy may not be given an opportunity to develop, while some of those that are being pushed may not deliver.