UK seeks energy security from mix of domestic power sources

Out-Law News | 07 Apr 2022 | 5:19 pm | 6 min. read

Developers need detailed and realistic policy and regulation to deliver the increase in domestic power supplies the UK government is seeking under its new energy security strategy, an expert has said.

Energy projects specialist Melanie Grimmitt of Pinsent Masons was commenting after the UK government set out how it plans to ensure the security of supply of energy in Britain in light of current global pressures on the price of energy, exacerbated by the war in Ukraine.

Cutout portrait image of Melanie Grimmitt

Melanie Grimmitt

Partner, Global Head of Energy

This is a vital time for the UK government to put in place the right regulation to ensure the projects on which it is relying to meet these challenges, can be developed and operational quicker than current timeframes allow

Grimmitt said: “For many years governments have been trying to deliver energy policies that balance energy security, decarbonisation and cost. The war in Ukraine has brought into sharp focus the limitations in those policies across Europe in relation to energy security, and we are now seeing energy security taking a greater priority. However, decarbonisation, and cost remain very high on the agenda still.”

“The UK government needs to strike the right balance between energy production it can control, the accelerated development of clean energy technology and infrastructure, and minimising any further increase on energy bills for businesses and consumers. This is a vital time for the UK government to put in place the right regulation to ensure the projects on which it is relying to meet these challenges, can be developed and operational quicker than current timeframes allow,” she said.

The new strategy, which was trailed last month, sets out the government’s plans to scale up the development of a range of energy technologies.

The strategy explains the government’s plans to reduce Britain’s use of oil and gas in the long-term, in pursuit of its ‘net zero’ emissions targets, but also to address the need to reduce dependence on overseas supplies in the shorter term by support the fresh exploration of North Sea oil and gas reserves. The North Sea Transition Authority is expected to open another licensing round for new North Sea oil and gas projects in the autumn.

The government confirmed its support for low-carbon nuclear projects too, describing nuclear as “the only form of reliable, low carbon electricity generation which has been proven at scale” and confirming its intention to “ensure the UK is one of the best places in the world to invest in nuclear”. It hopes up to 25% of Britain’s electricity demands will be met by nuclear by 2050 and plans to triple civil nuclear capacity to 24GW to achieve that. The government said Britain “can only secure a big enough baseload of reliable power for our island by drawing on nuclear”.

Alty Graham

Graham Alty

Partner

Many existing nuclear power plants are reaching the end of their operating life and it is important that this capacity is replaced and enhanced with the latest electrical power generating technologies

The government wants to add the equivalent of one new nuclear reactor’s worth of power to the UK’s nuclear project pipeline a year. To start, it plans to make a final investment decision on one new project before the end of the current parliament and two more such decisions in the next parliament “subject to value for money and relevant approvals”. The government said: “This is not a cap on ambition, but a challenge to the industry to come forward and compete for projects and aim to come online this decade.”

A new corporate body, the Great British Nuclear Vehicle, will be established later this year to support prospective nuclear projects “through every stage of the development process” and to develop “a resilient pipeline of new builds”.  The government said it will also explore “the potential for any streamlining or removing of duplication from the consenting and licensing of new nuclear power stations”.

Earlier this year the UK government committed £100 million of public funds to the further development of the Sizewell C nuclear project ahead of its expected final investment decision for the project.

Nuclear energy projects expert Graham Alty of Pinsent Masons said: “Electrical power generation from nuclear has long been a permanent feature of the UK energy mix. It provides reliable, low carbon electricity over the long term. Many existing nuclear power plants are reaching the end of their operating life and it is important that this capacity is replaced and enhanced with the latest electrical power generating technologies, including both large and small modular reactors, alongside a range of renewable technologies.”

“The announcement is very welcome, although we would encourage more than one nuclear project to be approved during this government if the intention is to create a real momentum in the development of these projects,” he said.

The government also intends to grow renewable energy capacity in Britain.

Renewable energy expert Gareth Phillips of Pinsent Masons said: “Overall the new strategy builds on the pro-renewables policy that we have seen government develop over the last two or three years, and the emphasis on the need for renewable energy generation is beyond doubt – it is a matter of national security.”

A revised target of 50GW from 40GW previously has been set for increasing the capacity of power that could be generated from offshore wind by 2030. The target for floating wind is also up to 5GW, having previously been set at 1GW, over the same period.

Phillips Gareth_May 2020

Gareth Phillips

Partner

The exclusion of planning reform for onshore wind and the failure to harness the contribution this technology could make is irrational in the context of the evidence available from reputable organisations

Specific measures to support offshore wind include proposals to speed up the grant of consent, with the aim of reducing the application period from four years to one year. The national policy statements for renewable energy infrastructure are also to be strengthened to reflect the importance of energy security and net zero and the Habitats Regulations Assessment requirements are to be reviewed. In addition, strategic compensation environmental measures including for projects already in the system to offset environmental effects will be introduced. The Secretary of State will also be given new powers to set shorter examination timescales.

Phillips said: “These new policy measures will be of huge benefit to offshore wind and potentially other technologies. If it takes 12 months to examine and determine an application for complex infrastructure, like nuclear, why is the same amount of time needed for solar, which is not complex at all? Whilst the ambition to cut consenting timescales to one year is a move in the right direction, a reduction to two years is perhaps more realistic.” 

The government also sees a role for onshore wind generation but has decided against “wholesale changes to current planning regulations” in England to support its development, despite recent reports that it was considering such intervention to reinvigorate the onshore wind sector. Instead, the government plans to “consult this year on developing local partnerships for a limited number of supportive communities who wish to host new onshore wind infrastructure in return for benefits, including lower energy bills”. Proposals to facilitate the repowering of existing onshore wind farms are being considered.

Phillips said: “The exclusion of planning reform for onshore wind and the failure to harness the contribution this technology could make is irrational in the context of the evidence available from reputable organisations including the National Infrastructure Commission, the Climate Change Committee, and the National Infrastructure Planning Association, all of which the BEIS Select Committee found compelling in its February report on the draft national policy statements on energy infrastructure.”

Initiatives to support the growth of solar power capacity in Britain were also outlined by the government, which said it expects a five-fold increase in the deployment of solar panels by 2035 and earlier this week granted development consent for the Little Crow Solar Park project, only the second solar ‘nationally significant infrastructure project’ to receive development consent since the Cleve Hill Solar Park in May 2020.

The government said it intends to change planning laws “to strengthen policy in favour of development [of solar farms] on non-protected land” and that it supports the co-location of solar panels on property used for other purposes, such as agriculture, onshore wind generation, or energy storage. Phillips said “Continued policy support for solar is welcome, but the strategy hasn’t lived up to its billing in this regard. The support appears more qualified than previously, with reference to developers having to offer compensation in respect of greenfield sites, but with no indication of whether that compensation should be physical in form – e.g. the re-provision or improvement of land – or financial.”

The government also pledged to “aggressively explore renewable opportunities afforded by our geography and geology, including tidal and geothermal”, but did not provide further details of its plans in that regard.

Plans to boost the production of hydrogen production to 10GW by 2030 – double the previous target – were outlined in the new strategy. The government announced it had underwritten a £400 million loan to London-based Johnson Matthey to support its research and development of sustainable technologies and hydrogen earlier this week.

Measures for delivering greater energy efficiency, such as through the increased use of heat pumps, were also outlined in the strategy, which also contained proposals to bolster electricity transmission networks and promote investment in energy storage technologies. A new ‘Future System Operator’ is to be established and tasked with overseeing Britain’s energy system and “integrating existing networks with emerging technologies such as hydrogen”.

With grid connection constraints being a common issue for generators to overcome, Phillips said: ”The current practice of grid availability dictating where generation stations should be located is not ideal and inconsistent with a plan-led development regime. The grid and associated processes need to be overhauled to enable a strategic approach to the deployment of new generating stations, and the proposals in the strategy are encouraging in this regard.”

The government also confirmed earlier this week that it is commissioned a review of the geological science of fracking.

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