National Grid: UK to miss renewable energy target

The UK will likely miss its 2020 European Union target to meet 15 percent of its energy needs with renewables, according to a study conducted by National Grid.

Even the most optimistic outlook in the utility’s Future Energy Scenarios (FES) report predicts the UK will generate only 12 percent of its electricity from renewable sources by 2020. This puts the country behind the EU deadline for meeting Renewable Energy Directives set in 2009, potentially exposing it to financial penalties.

Those penalties may never be levied, considering the UK voted on 23 June to leave the EU. But missing the target does show that, despite a growing clean energy industry, the UK lags behind goals it set years ago.

The FES report lays out four different scenarios for potential policy approaches. Gone Green is the scenario where environmental sustainability is the top priority, Slow Progression focuses on long-term environmental strategies, Consumer Power envisions a market with limited government interference and No Progression are policies that support the lowest cost solutions.

The Gone Green scenario predicts the UK will reach its target in 2022. No Progression, the most unfavorable for renewables, predicts the target is met in 2029. The UK met 7 percent of its energy needs from renewables in 2014.

“We continue to be in a period of great uncertainty over the future of energy,” the report said. “Although significant progress has been made towards the target, with 2020 only four years away it is [a] very challenging [one] to meet.”

National Grid said that while the wind and solar industry has been quick to develop, heat and transport still have to make “significant progress”. To meet the 2020 target, electric and hydrogen car usage needs to increase from 15 terrawatt hours (TW/hour) to 40 TW/hour. Adoption of clean heating systems needs to increase from 35 to 95 TW/hour.

“One of the biggest challenges will be in our heating system and in our transport system, and the inefficiency of some of the older building stock in the UK,” John Bromley, head of clean energy investments at Legal & General Capital, told Infrastructure Investor.

Even if targets are missed, Bromley said it’s important for the industry to have a goal to aim towards. “It means that innovators, technology providers, developers and investors can look at the challenge and start to think about how you can deliver it, what investment is needed, where it is needed.”

National Grid also said that current UK policies will not achieve a CO2 reduction target the country set for itself in 2008. The Climate Change Act set a target for 2050 to reduce CO2 levels by 80 percent based on 1990 levels. To meet this goal, the report said the UK should focus on installing 22GW of nuclear power, 100GW of renewables and 20GW of fossil fuel generation with carbon capture and storage technology.

Bromley added that despite uncertainty regarding the UK’s energy future, “the same agenda still remains”.

“We want more affordable power, we want it to be more sustainable, and we need it to be secure and a resilient energy system for us,” he said. “Now is the time for investment in the UK.”