Energy Security Strategy: the industry responds

Dr Nina Skorupska CBE, Chief Executive, Association for Renewable Energy and Clean Technology (REA): “The Energy Security Strategy is wholly inadequate. If ever there was a time for the government to be bold, this was it, but they have failed to rise to the challenge facing the country.

“Of course, we welcome commitments on solar, hydrogen and offshore wind, but the Government’s plans will lock the UK into more expensive, longer to build, non-renewable power sources. It ignores a huge swathe of other renewable technologies and the approach to onshore wind is totally inadequate. The Government also needed to turbocharge support for technologies which could tackle the cost of living crisis, and not just focus solely on developments which won’t come to fruition for another 5, 10, 15 years. For example, a £200m increase in the ECO home energy efficiency scheme would have helped thousands of households save around £600 a year on their energy bills. The Treasury’s refusal to offer this support will condemn people to continued financial hardship for the foreseeable future.

“The UK needs to move rapidly to an energy system which is independent, secure and stable – this Strategy will simply not achieve that.”

Anthony Ainsworth, COO, npower Business Solutions: “Clearly, any increase in homegrown power from low-carbon sources is a welcome move to help the UK become more energy independent, less carbon intensive and more resilient in the medium to long term. However, for businesses – who are struggling right now with short-term liquidity issues and high bills caused by the volatile wholesale market – today’s Energy Security Strategy feels like a missed opportunity.

“For example, helping businesses reduce energy consumption through more innovative efficiency solutions is a real ‘no regrets’ action that could be taken. These can be implemented quickly and would result in immediate savings both in terms of their bottom line and decarbonisation efforts. Similarly, incentivising businesses to become more self-sufficient through renewable on-site generation is a win-win solution. It would protect businesses from market volatility as well as helping them decarbonise. In addition, businesses with on-site assets can provide a much needed source of power during times of high demand.

“Overall, unfortunately, today’s announcement does little to help businesses address the short-term issues they are facing right now.”

Simon Oscroft, Co-Founder, So Energy: “As a 100% renewable electricity supplier, So Energy welcomes any focus within the Government’s Energy Security Strategy in strengthening our domestic supply of green energy as a positive step forward. However, today’s strategy does nothing to help the millions of households plunged into fuel poverty on 1 April after the price cap increased by £700 a year. The Council Tax Rebate package announced by the Chancellor in February only covers a fifth of this bill increase and so more immediate support is needed. Neither does this new strategy offer any support to the energy suppliers left in the market, all of who have been and will continue to foot the bill for what are increasingly loss making tariffs between now and the next price cap review. Improving home energy efficiency is another cost effective way of bringing down energy usage, lower customer bills and gain greater energy independence, but there’s nothing to address this in today’s strategy either. The cost of living crisis and associated projections for October’s price cap increase have got significantly worse since the February package was announced. With nothing to address this in today’s strategy, we urge the Government to bring forward additional relief measures in the coming weeks.”

Sue Ferns, Senior Deputy General Secretary, Prospect union: “This energy strategy is big on ambition and if matched with a concrete plan of action and funding from government will go a long way to providing the long-term energy security the UK needs. We are yet to see that concrete plan however and it must not be allowed to slip. Direct investment in new nuclear will be hugely welcome – we now need direct government support for Sizewell C, Wylfa and any other projects that can be set in motion. We have talked about this for too long and must commit fully with the cash and legislation to back it up.

“Sadly we heard very little about the nuclear supply chain, which is just as important as a nuclear build programme in powering a secure, net zero future for British energy. The Government must act now to retain key skills and expertise at the UK’s only nuclear fuel manufacturer, Springfields Fuels. We cannot be in a position of relying on foreign imports for UK reactors. Increased investment in renewables is also very welcome, providing that there is a requirement for greater UK content that creates and sustains high quality jobs, including in the supply chain.”

Danielle Lane, UK Country Manager, Vattenfall: “The Government has set out targets which send a clear message of our move away from imported fossil fuels to a future powered by low-cost renewables. A world leading offshore wind target is an exciting challenge that the industry can rise to, but the vital work to unlock this potential now lies in setting out a clear plan to remove roadblocks to unlocking investment. It must not take over six years to secure project consents with risk placed fully with developers, and vital issues like grid access need resolving quickly.

Our route away from the energy crisis lies in speeding up our shift to net zero. Onshore wind as a cheap, powerful, and quick-to-build technology could play an important role in this and the Government could have been bolder to unlock its full potential. Tried and tested, low-cost technologies like heat networks can also move quickly to set us off on the right foot, with pragmatic planning reform and the clear legislation in place.”

Sarah Merrick, CEO and Founder, Ripple Energy: “The UK is blessed with an amazing resource of onshore wind. Yet so many new wind farm sites are stuck in the planning system. The Government can unlock a cheap, clean energy resource overnight which will lower bills, support our energy independence, and reduce emissions. It’s what people want.
“That long-term focus on onshore wind must be combined with a major push on energy efficiency and heat pumps in order to help meet the short-term challenges facing households, plus a government campaign to share simple tips and advice to cut our energy use.
“Most importantly, any calls for the speed of decarbonisation to be slowed, or for us to revisit fracking in response to this crisis must be fiercely opposed. It won’t reduce prices and goes against efforts to reduce emissions. The simple, cost-effective steps I have outlined will all decrease our emissions and therefore reduce our dependency on imported fossil fuels to help ease the cost of living crisis.”

Robert Colvile, Director, Centre for Policy Studies: “:As the view for household energy bills gets bleaker by the day, the government is right to plan ahead to bolster domestic supply and boost UK energy security. The role of hydrogen and nuclear in this is key, as we have argued, and the Government’s recognition of this is extremely welcome.

‘Despite this, it is disappointing to see that the Government’s ambitions have not carried over to other alternative energy sources, such as onshore wind and fracking. Nor have they taken the opportunity to promote demand-side energy efficiency, including via insulation – which in turn will help reduce the most significant costs and support the push for Net Zero. The decision to nationalise core National Grid responsibilities is also highly alarming.”

Myles Kitcher, Executive Director, Peel NRE: “What today’s strategy recognises is that we can have secure and affordable energy while still meeting out net zero obligations. We welcome the acceleration of hydrogen, with a doubling of the production target by 2030. Here in the North West we’re well placed to help deliver on this ambition, with HyNet, but there are a raft of other hydrogen projects that can make a significant difference, such as the UK first plastic-to-hydrogen facility at Peel NRE’s Protos in Cheshire. We’re looking to roll out the Powerhouse Energy technology with up to 70 sites across the UK which could produce enough hydrogen to fill nearly 5 million buses. We need the right policy climate to support these ambitions and allow innovation at a local level.”

Jonathan Maxwell, CEO and founder, Sustainable Development Capital: “We are surprised to learn that the Government is not doing more to drive energy efficiency. Improving energy efficiency in commercial, industrial and public sector buildings, as well as households, has a huge role to play in cutting carbon, lowering costs, and increasing our energy security.

“The International Energy Agency has already pointed to energy efficiency measures in buildings and industry as a way of reducing reliance on Russian gas, but it often gets less attention than it deserves. This must change.
“… energy efficiency measures quickly pay for themselves in terms of the cost savings they deliver, and then go on to produce further savings. There is an investment case, an environmental case and a national security case for putting energy efficiency at the heart of Government energy policy.”

Laura Bishop, Chair, Ground Source Heat Pump Association: “the Government’s energy security strategy published today represents a missed opportunity. Instead of focusing on immediate measures to reduce dependence on expensive imported gas, including accelerating the rollout of heat pumps, the strategy focuses on the government’s favoured electricity generating technologies, including those with long lead in times. This will do nothing to address the immediate cost of living and energy crises facing UK consumers.”

“…The GSHPA has been calling for an acceleration of the welcome measures contained in last year’s Heat and Buildings Strategy, but today’s announcements provide no additional funding for consumers wanting to switch to heat pumps, nor give any clear indication of when the legacy environmental costs on electricity bills will be removed. We needed to see far greater urgency in today’s announcements, with a clear focus on reducing energy demand in the short-term. We didn’t get it.”

Siobahn Meikle, Managing Director for the UK and Ireland, Eaton: ‘The strategy is welcome, but we must remember that energy security isn’t simply a case of plugging in more UK-based energy sources – it should be about a system-wide approach that makes the best use of all the resources we have. That means making the grid more flexible at the same time as we are diversifying our energy mix and increasing the amount of electricity generated from renewables. Increasing the amount of storage capacity will be critical to this, and for this to happen we need a regulatory regime that incentivizes private investment in this vital technology.

“This system-wide approach should include simplified regulations to avoid double charging on energy storage products, as well as creating a market for demand-response flexibility products. In addition to this, we should be doing far more to encourage private investment through greater stability and predictability – in turn improving investor confidence.’

Jeremy Nicholson, Alfa Energy Group, Corporate Affairs Officer: “Action is needed on all fronts to ensure UK energy users have access to secure, affordable supplies. That means more low carbon renewables, nuclear, energy storage and big improvements in energy efficiency. In the short-term, it also means more oil and gas production to help reduce European dependence on Russian supplies. This is not a change of destination. We are still aiming for Net Zero, but the route we take to get there has to be adjusted to reflect the current, very difficult circumstances.”

Tom Williams, Partner and Head of Energy and Infrastructure, Downing LLP: What we do over the next decade will be critical to mitigating or averting a climate crisis but, unfortunately, it seems that a short term focus on the cost of living and energy security is driving much of the government’s Energy Strategy. Increased emphasis on nuclear energy as part of the solution is a medium to long term effect; it takes years to plan, commission, build and deliver new nuclear capacity. In the short term, fossil fuel intensive generation will be sweated harder for longer, emitting more greenhouse gases in the process.

The fastest and cleanest way to reduce our energy bills is a greater use of renewable energy. The Government must do more to encourage the rapid scale up of renewable energy infrastructure through easing of planning regulations for wind and solar, especially on-shore wind. Pairing this with improved storage and transmission is the only way to deliver against our competing demands of energy security and an impending climate crisis. While, to mitigate the short term impact of fossil fuel use, we need to see equal commitment to carbon capture and sequestering technologies.”

Jim Mowatt, chair, Trade Unionists for Safe Nuclear Energy (TUSNE): “…Sourcing 25% of our electricity from nuclear will go a long way to ensuring the UK’s long term energy security and net zero ambition, and the strategy meets TUSNE’s goal of a strong nuclear component within a balanced energy mix.

“However, the strategy needs to be met by a concrete plan of actions. The government should commit the right level of funding to build a fleet of nuclear reactors and make its strategy a reality. The government must also act to protect and develop the British nuclear supply chain. Particularly, retention of skills and expertise at the UK’s only nuclear fuel manufacturer, Springfields Fuels, must be a key priority. Trade Union members stand ready to support the new nuclear renaissance, but the resulting jobs must be high quality union ones that support the UK industry and do not syphon money off to boost offshore profits. The time for talking is over, now is the time for doing.”

Tony Meski, Senior Market Development Analyst, Wärtsilä Energy: “Renewables must take the lion’s share of responsibility for decarbonising our planet in the short term and it is right that huge increases in solar and wind are at the centre of the Government’s energy strategy. Renewables are cheaper, fairer, and cleaner than any other energy source and must continue to be the key focus. By contrast, further entrenching baseload fossil fuels, particularly with the inclusion of blue hydrogen, is not a sensible, long-term solution to meet our energy needs or tackle the climate emergency. Investment should instead be laser-focused on the massive deployment of renewable energy and supporting the development of green hydrogen, along with other sustainable fuels which can help to decarbonise not only our energy industry but also other harder to abate sectors such as transport and industry.”

Harvey Sinclair, CEO, eEnergy Group: “The most effective and immediate way to reduce the UK’s dependence on oil and gas is to use less energy. Any investments in new nuclear and colossal offshore wind farms should be matched by investment in energy efficiency solutions which will quickly pay for themselves and help to tackle the 30% of energy being needlessly wasted in most buildings throughout the country.”

James Johnston, CEO and Co-Founder, Piclo: “A flexible resilient grid is critical for the UK’s energy security and while new nuclear commitments will understandably attract headlines, driving open and competitive flexibility markets across System Operators will be just as important.”

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