Disjointed energy policies but room for hope

Disjointed energy policies damage the country’s route to net zero, but there is still some room for hope as Patrick Mooney discovers.

Rishi Sunak’s U-turn on several of the country’s key policies for achieving net zero carbon emissions looked decidedly naïve as Britain was battered by Storms Babet and Ciarán, combining high wind speeds with torrential downpours of rain.

Weather extremes appear to be getting more and more common with no let-up in sight.

Across Europe many countries experienced their hottest ever September on record with October looking like it may follow it into the record books.

Ocean temperatures are also at record high levels as it looks increasingly likely that 2023 will be the warmest year in record.

Storm Babet flooded over 1,300 homes making the occupiers homeless and it led to seven people losing their lives in England and Scotland.

Ciarán might take an even heavier toll on southern England. Indeed, flooding is now considered to be the greatest risk to UK homes.

Boost to wind farms

However, the associated strong winds were not unwelcome to the operators of our wind farms, particularly those based offshore.

Early in October the world’s largest offshore windfarm project at Dogger Bank in the North Sea, began feeding power into the UK grid, when the first of 277 turbines went into operation at a site that will eventually produce enough energy for about 6 million homes and businesses.

The scheme sits 70 miles off the coast of Yorkshire. It was jointly developed by Britain’s SSE and Norway’s Equinor and Vårgrønn, and will eventually produce 3.6 gigawatts of power when it is completed in 2026.

Last year, SSE switched on another huge wind project at Scotland’s largest offshore windfarm, Seagreen.

A bewildering fact cited by the wind farm’s developers is that each rotation of the 107-metre-long blades on Dogger Bank’s first turbine could produce enough energy to power an average British home for two days.

Bad news

This good news story is in stark contrast to the criticism heaped on the Government, when it was revealed that a disastrous recent energy auction saw no new offshore windfarms secure contracts despite there being the potential for 5GW of projects – enough to power 8 million homes a year.

We clearly cannot take continuing growth in this sector for granted.

In other unwelcome news it was reported that almost £1 billion of funds meant to help build Britain’s electric vehicle charging network remains unallocated more than three years after it was first announced by Rishi Sunak, when he was Chancellor of the Exchequer.

Promised in March 2020, the “rapid charging fund” was meant to support the growth of electrical capacity at motorway service stations.

It was intended to help fund upgrades to the grid so that more electric cars can be rapidly charged at the same time.

Yet the fund is still not yet open for applications.

A pilot scheme originally planned for late 2022, was pushed back to Spring 2023 and then the summer of this year.

The Government has now said there will be further delays after the Transport Minister, Jesse Norman, admitted to the House of Commons it was still “in the process of developing a pilot … which will open in due course”.

Delayed timetables

Industry sources said the pilot may not launch before Christmas and warned the latest setback risks delaying the rest of the fund until after a General Election, which is now expected to take place sometime in 2024.

“It’s very disappointing that the rapid charging fund is still not open for business,” said Simon Williams, head of policy at the RAC. He warned the Government was also on track to break a pledge to have six high-powered chargers at every motorway service area in England by the end of 2023

Mike Hawes, the chief executive of the Society of Motor Manufacturers and Traders, said: “The rapid charging fund is essential for financing the grid improvements necessary for a national ultra-rapid charging network, so we cannot afford any more delays, else we delay the delivery of net zero.”

Overall, the Government has set itself a target to decarbonise the UK electricity system by 2035, while Labour has pledged to achieve the same feat by 2030. Doubts remain over the achievability of both these objectives.

Warning to Sunak

The Paris-based International Energy Agency has struck a broadly upbeat tone on the potential for a faster global energy transition, predicting for the first time that fossil fuel demand will peak this year and insisting that net zero by 2050 is still possible across the globe.

In its latest annual report, the IEA hailed the gathering pace of the worldwide transition to cleaner energy, forecasting for the first time that global demand for oil, gas and coal would peak before the end of the decade.

But the report called on Governments not to derail progress by weakening climate measures, warning that effects such as wildfires and flooding meant that “no country is an island”. This was taken to be a swipe at recent statements and policy U-turns by Rishi Sunak.

“You can’t give investors one strategic direction today and change it tomorrow, these are up-front investments,” Director of the IEA Dr Fatih Birol said. “Capital you put on the table is huge and this could lead to hesitation for investors.”

But in a relatively upbeat message on motor vehicles, Dr Birol said nearly one in two cars sold by 2030 would be electric, compared with one in 25 two years ago, while 70% of energy came from fossil fuels 10 years ago, compared with a projection of 40% by 2030.

Energy costs

Meanwhile British households have experienced mixed news on their energy costs.

The good news is that the cost of the average annual dual-fuel bill in Britain has dropped below £2,000 a year for the first time since April 2022 due to a lower energy cap kicking in.

This was countered by the fact there will be no repeat of the £400 universal bill subsidy this year, and the End Fuel Poverty Coalition says the financial squeeze created by the ongoing cost of living crisis means “people will still feel the pain of high energy bills this winter”.

The Government will instead make cost of living payments to about 8 million vulnerable households. This includes a £900 payment for those on means-tested benefits, £300 for pensioners and £150 for disabled people.

Price cap changes

On 1 October, the price cap set by Ofgem for households in England, Wales and Scotland was reduced to £1,834 a year for a typical annual dual-fuel energy bill, from its previous figure of £2,074.

The £1,834-a-year cap covering October to December is based on new Ofgem calculations that assume households now use 7% less electricity and 4% less gas, having cut back their consumption in the cost-of-living crisis.

However, the leading forecaster Cornwall Insight has predicted the rate will climb back to £1,898 a year for the typical home from January.

Hidden in the Ofgem announcement was the news that standing charges are up 8% for gas and by a massive 119% for electricity. Standing charges now add up to just over £300 (equivalent to about 17%) for the average billpayer.

Although the conflicts in the Ukraine and Palestine have pushed the cost-of-living crisis off the front pages of many newspapers, people will still be focusing on their energy bills over the coming Winter and the risks of damage to their property from seasonal storms.

Patrick Mooney is news editor of Housing Management and Maintenance magazine