The UK is missing an historic opportunity to decarbonise its energy sector – but a whole system approach holds the answers, says Jonathan Chapman, UK managing director of Burns & McDonnell
In March, the government announced that the UK’s carbon emissions from fossil fuels have declined to levels not seen since the end of the 19th century. These reductions are mostly due to the closure of coal-fired power stations, and emissions have been declining for several years. Last year’s decline, however, was less than it has been for five years.
This plateau has been caused in part because the UK has thus far focused its efforts on the most cheap and easy policy areas. What we’ve done in the past, however, will not get us to where we need to be. We must, therefore, have courage to continue to drive forward what we know is right for the UK.
The UK will not achieve its aim of decarbonising its energy sector unless it acts now
The problem is that there is not sufficient integration between technologies or investment certainty to really make the difference in the UK energy sector. This places a strain on the UK’s objectives. Most of the current solutions we need to meet carbon emission reduction targets lack economic clarity, cross traditional boundaries of government and utility, while others have not advanced because they challenge system reliability.
To take an example, electric vehicles (EVs) are currently feared by electric network owners and operators because of the impact mass adoption will have on the existing Grid. We have the imagination and capability to integrate them as network assets through vehicle-to-Grid technology, and we know they will bring pervasive benefits. But so far we have not done what is required to bring EVs into the mainstream. In short, the vision for the UK is grand, but we need to be bolder.
The fact is that the stagnant trend in carbon emissions reduction will continue, and the UK will not achieve its aim of decarbonising its energy sector unless it acts now to adopt a holistic view of the problems – a whole system approach. This approach is a fully integrated proposal for master-planning and delivering energy services at a district level. It encompasses the supply and demand of all interconnected energy vectors in order to optimise the UK’s sustainability, reliability and affordability performance.
A new roadmap for our energy sector is required, which brings together all players, including market participants, technology, government and systems, to deliver a holistic framework. Burns & McDonnell’s industry roadmap sets a course to deliver greater technology and network integration, and the further empowerment of consumers. This model incentivises investors and developers to take risks outside of their core business to consider whole system solutions, and rewards innovation based on the benefits provided throughout the value chain.
The whole system approach would engage stakeholders to assess how to flex capacity
A future focused on the development of solutions such as microgrid technology and private networks will help us take full advantage of new technologies. By utilising energy assets and services, across all energy vectors, the UK will make the most of existing systems and keep costs contained. This includes gas and electricity, but also heat and hydrogen networks and, crucially, transport. This will enable consumers and businesses to gain advantage from the full benefits of the different energy resources and ensure that the take-up of new technologies is not held back.
The roadmap also details new approaches to put customers in control of their home and transport energy usage, empowering them to take an active role in reducing their bills. The recent Helm Review concluded that industry and government need to do more to reduce the burden on bill payers. We need new pricing models that put customers in control of their energy usage, helping them to be ‘prosumers’ who make active decisions using real-time price signals. Empowering people to take an active role in reducing their energy bills supports decarbonisation, enhances energy security and promotes affordability.
It is also imperative that network owners, generation asset owners, retail participants, regulators, customer groups and community representatives come together to address current barriers, such as a lack of harmonisation between regulations, policy and pricing. The whole system approach would engage stakeholders to assess how to flex capacity, develop new financial markets, and adjust policy to accelerate investment in clean solutions. Collaboration will create uniform policies that drive desirable outputs, without leaving the vulnerable behind.
It is the Government who must now sit in the driving seat, turn strategy into action and connect the dots between stakeholders. The Clean Growth Strategy is ambitious but, as the Committee on Climate Change recently said, we now need to urgently firm up policies and provide more detail in order to achieve required emissions savings. The energy market is changing rapidly, and the need for radical adaptation grows ever closer. Get it right, and the whole system approach has the potential to solve all aspects of the energy trilemma, to the benefit of all. This is the biggest opportunity in the next 30 years and we can’t miss it.
Jonathan Chapman is UK managing director of Burns & McDonnell. He is a chartered civil engineer with 25 years’ experience in the energy, water and telecoms sectors