Energy is essential to our daily lives and supporting a successful economy, but providing secure, sustainable and affordable supplies is increasingly challenging. Globally demand for energy is growing – and with it the need to reduce carbon dioxide (CO₂) emissions and tackle global climate change.

In the UK, like many other European countries, reserves of oil and gas are declining – increasing dependency on gas imports, mainly from Norway, Russia and Algeria.

A number of UK coal stations have opted out of the Large Combustion Plant Directive (LCPD) and will close from 2011 and nuclear stations will be decommissioned. Over the next 20 years the UK will need to replace a third of its generating capacity – equivalent to 20 power stations.

In the Energy White Paper, published in May 2007, the UK Government set out its strategy for the provision of energy, including:

• Policy measures to encourage low carbon technologies, including renewables
• Clean coal projects, such as carbon capture and storage
• Demand management measures, including a mandatory carbon reduction programme for businesses 

In addition, the obligation on energy suppliers to achieve CO₂ savings from customer energy efficiency programmes will double under a new Carbon Reduction Target Scheme, starting in 2008.

The White Paper also highlighted the issues of nuclear energy, access to gas supplies and EU energy market liberalisation.

Delays have been encountered when connecting new, renewable energy projects to the grid. The Planning Bill, which went before Parliament in February 2008 proposed a new system for nationally significant infrastructure projects to speed up planning decisions on strategic renewable energy and grid reinforcement projects. In addition, a Transmission Access Review, conducted jointly by the Department for Business, Enterprise and Regulatory Reform and regulator Ofgem is addressing the issue of connecting renewable energy projects to the grid in the medium and long-term. A report is expected to be published in summer 2008.   

The Government’s Energy Markets Outlook Report, published in October 2007, estimates that the UK will need 20-25 Gigawatts (GW) of new generation capacity by 2020. The UK’s generators have announced plans to build projects which would produce 14 GW, mainly Combined Cycle Gas Turbine (CCGT) plant.

In January 2008, the UK Government announced it would allow new nuclear power stations to be built, to diversify the low carbon generation mix. However, the Scottish Government has stated a clear preference for large-scale deployment of renewables, backed by clean coal.

Going forward, renewable energy will be given a further boost with the banding of the Renewables Obligation to bring newer technologies, such as wave and tidal power into operation. The announcement of a Strategic Environmental Assessment of the UK coastline to pave the way for offshore wind developments in December 2007 will also help.

In January 2008 the European Commission published a proposal for a Directive on Renewable Energy, which would require the UK to meet 15% of its energy supplies from renewable sources by 2020. The UK Government welcomed the proposal but acknowledged the target is challenging.

Within the UK legislative framework, the Energy Bill 2008 will incorporate reforms which will enable the aims of the Energy White Paper to be delivered, including private investment in offshore gas infrastructure, nuclear, renewables and carbon capture and storage projects, which will allow the continuation of secure and cost-effective coal generation with 90% less CO₂.

John Campbell, Impact Leader