How will the UK align its future power generation needs with an environmentally sound energy policy – and what will this energy mix look like? National Grid Energy Supply Manager Peter Parsons outlines the way forward.
There are very few certainties when peering into the future to examine how we will use energy in 2020 and beyond. But one thing we can say with a strong degree of confidence is that renewable energy will play an increasingly important role in the decades ahead.
In 2012 the UK’s total renewable energy capacity was about 15GW. When National Grid revealed its UK Future Energy Scenarios earlier this year, one of the areas we looked at was the potential growth in renewable energy capacity.
Under our Gone Green scenario we projected that this capacity would reach 100GW by 2035. Even under the more conservative Slow Progression scenario our potential output from renewable energy would be 50GW – more than three times the current level.
It’s important to put the ‘renewables’ conversation into context. Of the 100GW or so of renewable energy capacity in 2035, some 50GW would come from wind power, with a bias towards offshore wind, according to our Gone Green projections. There is also a significant reliance on the development of wind power in our Slow Progression scenario, where the capacity in 2035 is approaching 30GW.
The importance of market reform
Achieving such a large growth in wind generation capacity requires a lot of new infrastructure over the remainder of this decade and through the 2020s. So, it’s absolutely critical that the current Electricity Market Reforms (EMR) are concluded successfully and provide the right framework for investment. There is an acute need for new generation capacity and without these vital reforms it may be impossible to progress at the pace required.
So where do we stand right now? We projected the required build rates for new transmission capacity in our Gone Green scenario, which breaks down into 11GW of additional net capacity by 2020. This includes approximately 13GW coming from wind power, 2GW from new interconnections and 3GW from biomass. In turn, this is offset by 6GW of coal and oil closures and a small reduction in nuclear capacity, while we are also expecting both new gas and some gas closures during this period.
Right now, only 4GW of this figure is under construction, although additions to existing plant will contribute a further 2GW. Consequently, a significant number of projects are awaiting Final Investment Decisions (FID), which means that we’re entering a crucial phase in the next few years and will be looking for EMR to deliver this new capacity.
The changing energy mix
So, if we project an increasingly prominent role for renewable energy, what else do we see changing? Our two scenarios paint different pictures although there are some points in common.
In Gone Green we project a small increase in nuclear power capacity, with new plant capacity exceeding existing plant closures. Meanwhile, in Slow Progression, we see limited change as delayed deployment of new nuclear capacity is offset by life extensions. In both scenarios we project lower coal capacity stemming from plant closures – a result of emissions legislation, such as the Large Combustion Plant Directive and the Industrial Emissions Directive.
And what of the UK’s gas generating capacity? Our two scenarios both project limited new build in the short term, but an increased role for gas in Slow Progression where the development of renewable resources is slower. By contrast, if the progression of renewable energy is quicker as in Gone Green, we see the role of gas becoming increasingly important as back-up power generation to cover for inconsistencies in the supply of wind power.
Meeting peak power demand
Making sure that we have the right levels of spare capacity (or plant margin) in place to meet fluctuations in peak power demand is an important factor in the future of energy supply.
The introduction of a greater percentage of renewable energy into the mix adds another layer of complexity, because the availability or typical load factor for wind power is about 30% within a very broad range, compared with up to 90% for coal, gas and nuclear power. This makes the analysis to determine plant margins much more complex than the traditional method, where all plant was considered to operate at 100%.
In our Gone Green scenario we project that plant margins dip between now and 2015, mainly because of lack of new generation facilities being built, before stabilising at around 5% (on a de-rated basis), through to 2035. This is dependent on new generation plant being built.
So, the overall message? Expect to see an increasingly influential role for renewable energy in our future energy mix, but at the same time we need to see the fruits of EMR in the next year or two to deliver new generating plant.
Find out more
National Grid’s 2013 UK Future Energy Scenarios (FES) paint a picture of how the UK’s energy landscape might look in 2035 and as far out as 2050. For more on FES, click here.
Richard Smith, National Grid’s Head of Energy Strategy and Policy, explains how these scenarios have been developed.