2017 Future Energy Scenarios launched
July saw the launch of National Grid’s 2017 Future Energy Scenarios. In a rapidly changing energy landscape the scenarios explore what Great Britain’s energy mix might look like out to 2050, drawing on expertise from across the industry. So, what are the key messages this year?
2017 Future Energy Scenarios launched
"An energy system with high levels of distributed and renewable generation is now a reality."
National Grid 2017 Future Energy Scenarios.
In 2016, renewable generating capacity made up 34% of total installed capacity.
Source: National Grid 2017 Future Energy Scenarios.
Ensuring access to safe, secure and reliable supplies of energy is one of the biggest challenges facing society today. National Grid’s Future Energy Scenarios (FES) are published annually and look at how the way we produce and consume energy might change in the coming decades.
The FES are based on the energy ‘trilemma’ of security of supply, sustainability and affordability. They are a catalyst for debate, bringing together insight from a wide range of stakeholders through an engagement programme that has involved over 390 organisations over the past 12 months.
The 2017 scenarios
Following feedback from stakeholders we’ve retired two of the previous scenario names and introduced two new ones this year because they more accurately reflect the scenario content.
Each of the scenarios explores different levels of prosperity and green ambition. They are:
This is a world of high economic growth and people have money to spend. Consumers’ appetite for the latest gadgets is driving innovation and technological advances. Market-led investments mean that spending is focused on smaller generation that produces short- to medium-term financial returns.
Two Degrees replaces the former Gone Green scenario and has the highest prosperity levels. There are high levels of low carbon energy and consumers make conscious choices to be greener. This is the only scenario where the UK 2050 carbon reduction target is achieved.
In Slow Progression, economic growth is slower and affordability lower, competing with the desire to cut carbon emissions. There is a mix of renewable and low carbon technologies, and high levels of distributed generation.
Steady State replaces the previous No Progression scenario and reflects a world of ‘business as usual’. Security of supply and low costs for consumers are paramount. Innovation slows because there is little appetite or money to invest in long-term, low carbon technologies.
The themes for 2017
An energy system with high levels of distributed and renewable generation is now a reality. This growth is set to continue. In turn, this will make operating a secure and cost-effective system more complex. In 2016, renewable generating capacity made up 34% of total installed capacity. This could increase to as much as 60% by 2050.
The rapid transformation of the energy sector is being led by new technologies and fresh business models. Market and regulatory arrangements will need to keep pace with this change to support a more flexible energy system with increasing numbers of participants. Electric vehicles, demand side response and battery storage are areas of rapid change. Electricity storage capacity could grow to almost 6GW by 2020.
Electricity demand could increase significantly and the shape of demand will also change. Initially, this will be driven by electric vehicles and later by heat demand. A coordinated approach will be needed to give consumers the best value for money, alongside investment in smart technologies, infrastructure and new commercial approaches. There could be as many as nine million electric vehicles on our roads by 2030.
Gas is critical to security of supply today and will remain so as Great Britain continues the transition to a low-carbon future. Gas will have a long-term role to play as a flexible, reliable and cost-effective energy source favoured by many consumers. Gas makes up more than twice as much of our energy supply today as electricity and could still be ahead by 2050.
What might the next technological breakthrough be for the energy sector? How might the direction of policy change? There remains a lot of debate across the industry on such uncertainties. To explore these broader energy pathways, we have developed a range of sensitivities – an extra dimension to work alongside the scenarios.
These sensitivities are based on a series of ‘What if’ questions. For example, what if we rapidly adopted electric vehicles or heat pumps? What if there was a breakthrough in hydrogen technologies?
Have your say
Stakeholders play a vital role in shaping the FES each year. To find out more about the scenarios and to contribute to the debate, visit http://fes.nationalgrid.com/ where you’ll find lots more insights and details of how to take part in future stakeholder events. These include a series of webinars – to register for these visit http://fes.nationalgrid.com/webinars/.
You can also join the debate on the future of energy on Twitter at @nationalgriduk and via our LinkedIn group ‘Future of Energy by National Grid’.