Phasing out coal will not undermine the security of the UK’s energy supply and could be achieved two years ahead of schedule, according to a new report from think tank Bright Blue.
In its report, Keeping the lights on: security of supply after coal, the liberal conservative pressure group said that bringing the government’s planned 2025 phase out forward “to at least 2023″ would give energy investors greater certainty, as well as reducing carbon emissions and air pollution.
The report included analysis from Aurora Energy Research, which tested the UK security of supply under three different scenarios:
- ‘Base case’. Renewables, nuclear and interconnector capacities continue to grow. Hinkley Point C nuclear power station is delivered in 2029 (three years behind schedule). Coal is forced to close at the end of 2025, but the Capacity Market creates increased procurement for all existing thermal plant in the first half of the 2020s, including coal. Overall, there is a moderate need for additional thermal plant in the near term.
- ‘Low stress’. Renewables, nuclear, and interconnectors capacity exceeds current expectations and is coupled with falling demand and the build-out of demand side response (DSR) and storage. Hinkley 7 Point C nuclear power station is delivered on time in 2026. Coal is forced to close at the end of 2025 at the latest, creating a less profitable environment for marginal thermal plant and there is very limited need for additional thermal plant over the long term.
- ‘High stress’. Demand rises and the build-out of renewables, nuclear and interconnectors is much slower than expected. Additionally, in order to simulate a pessimistic response to forced closures, all coal plant is assumed to close by the end of 2020. Hinkley Point C nuclear power station is also cancelled.
The analysis found that the lights would stay on under all three scenarios. “Phasing out coal will not undermine the security of the UK’s energy supply. There is plenty of time under each scenario to commission any required new gas capacity,” the report’s author Ben Caldecott said.
Caldecott, an associate fellow at Bright Blue, added: “Coal phase-out, even under a ‘high stress’ scenario, will not result in the lights going out. The analysis presented in this report also shows the significant benefits for pollution, energy bills, and system security of pursuing a ‘low stress’ scenario, by further encouraging renewables, interconnection, storage, DSR, and energy efficiency.”
He made the following recommendations to the government:
- Proceed with coal phase-out plans and bring the the 2025 target forward to at least 2023.
- Use an emissions performance standard to simply regulate coal out of the system by the target date
- Encourage renewables and interconnection, as well as storage, DSR and energy efficiency to deliver the ‘low stress’ scenario.
- Develop targets and plans for DSR and storage, aiming for 4–5GW and 5–6GW of capacity respectively by 2030
- Create a new home improvement mechanism to encourage energy efficiency measures
- Plan for renewables to plug the capacity gap in the late 2020s if Hinkley Point C nuclear power station is not built
- Take the lead promoting coal phase-out internationally
Read the full report: Keeping the lights on: security of supply after coal