In the past month, the IPCC has released a stark warning about the urgency of global action to combat climate change – but there has also been progress made in areas such as exploring what our net zero electricity future could look like and in funding for vital new technologies. Here’s everything you need to know:
Many businesses will welcome the news that business rates relief on ‘green’ technologies, including solar panels and batteries, have come into effect from April 2022. In his Spring statement, Chancellor of the Exchequer Rishi Sunak moved the implementation of this measure forward by a year (from April 2023) to help businesses to mitigate against high energy prices by installing on-site generation and energy storage.
It’s estimated that the relief on these rates will collectively save businesses more than £35 million over the next year1 and contribute to the decarbonisation of commercial buildings. So if your business was planning to install green technologies on-site, such as solar panels or heat pumps, as part of its sustainability strategy, then you may find that this may be possible sooner. You can find out more about the business rates relief on green technologies here.
By installing these technologies now, you can equip your business to play its part in supporting a net zero electricity system in the future, as a new report has found that customer flexibility will be crucial. The report, from trade body Regen on behalf of National Grid ESO, has demonstrated how a fully decarbonised electricity system can be achieved by 2035, in line with Government targets. The ‘Day in the Life 2035’ study gives an hour-by-hour analysis of how a net zero power system could function on a cold, calm and cloudy winter day.
On the day presented, there is low renewable output and high demand. The report estimates that by 2035, consumption of electricity in Great Britain could double to 450-500TWh per year2, driven largely by the additional demand created by electric vehicles and low-carbon heating systems. This will be a challenge for a system that’s based on renewables, but Regen has found that by combining carbon capture, energy storage and demand-side flexibility, the grid should be capable of maintaining the balance between supply and demand. To read the full report, click here.
Our Sales and Marketing Director, David Taylor, had this to say about the Regen report: “Everything we do at Bryt Energy is about working towards a net zero electricity future – so we were encouraged to read Regen’s latest report, because it shows that a zero carbon electricity system is within our grasp. We all have a part to play in order to turn this scenario into a reality, and with the business rates relief on green technologies set to come into force shortly, investing in low carbon technology could be a great step for many businesses.”
Long-duration energy storage (LDES) technologies – those that can output stored energy at full capacity for longer than four hours, such as pumped hydro storage, played a key role in balancing the system in the Day in the Life 2035 report. A recent report from Aurora Energy Research also highlighted the need for LDES, with their study indicating that up to 24GW of LDES may be needed to support a net zero electricity system by 20353.
However, there are currently a number of challenges facing LDES projects, as development typically involves high upfront costs, and it can take a long time for projects to move from planning to operational stages. A lack of revenue certainty is also causing investors to hold off on funding LDES projects. Recent talks between energy storage representatives and Energy Minister Greg Hands have highlighted that if the government introduced a cap and floor mechanism for LDES projects, it could unlock ‘billions of pounds’ in investment in this area and create thousands of skilled jobs.
Within a cap and floor mechanism, customers that win contracts with LDES projects will top up prices that fall below the agreed ‘floor’ price, while any earnings the developer makes above the ‘cap’ are returned to the customer. A system like this could give developers and investors the revenue certainty they need to back LDES projects, whilst still being fair to bill payers. Interconnectors are currently developed through a cap and floor mechanism, so it’s encouraging to hear that a similar mechanism could be used to develop LDES, as with enhanced LDES we could significantly reduce the UK’s reliance on imported gas.
It’s also exciting to hear that Ofgem’s Strategic Innovation Fund (SIF) has awarded funding to 40 innovation projects across the gas and electricity networks. Up to £150,000 in funding has been allocated to each project, and it is to be used to explore how new technologies or approaches could solve some of the biggest challenges facing the energy sector as we move towards net zero. One of the chosen projects will investigate how satellite data could help to ‘keep the lights on’ and keep people safe during emergencies such as flooding, for example, while another will seek to develop a toolkit to help planners to understand how gas and electricity networks can decarbonise rail transport.
We’re hopeful that this funding, in addition to a potential future funding mechanism for LDES, will lead to some truly innovative technologies and solutions that will smooth the transition to net zero.
In early March, the UN’s Intergovernmental Panel on Climate Change (IPCC) published the second part of its sixth assessment (AR6), discussing the impacts, adaptation and vulnerabilities associated with the climate crisis. The review emphasises that we have a “brief and rapidly closing window of opportunity to secure a liveable and sustainable future for all”.
The IPCC’s message is clear: we must rapidly increase our efforts to limit global warming to within 1.5°C above pre-industrial levels or the impacts of the climate crisis will become devastating and irreversible. The report highlighted that there are a number of adaptations we can make to reduce further impacts of global warming as much as possible. These range from nature-based solutions, such as planting trees upstream to slow excess river flows and shade homes during heatwaves, to ensuring universal access to clean water and clean energy solutions in order to make populations more resilient to climate impacts. Since then, the third and final section of the IPCC’s review has been released, focusing on the mitigation of climate change and developments in reducing emissions. You can access both reports from the IPCC here.
When our energy experts from Bryt Energy attended edie’s Sustainability Leaders Forum on 8th March, they heard more on the IPCC’s second report from Sir David King – one of the UK’s leading climate scientists and former Government’s Chief Scientific Advisor. He believes that we need to carry out a ‘three-pronged attack’ to create a manageable future for mankind, which includes reducing emissions (mainly by moving away from fossil fuels), removing emissions from the atmosphere, and repairing our ecosystems through measures like tree planting and carbon sequestration.
Sir David King argues that businesses should be pushing for policy change and international collaboration, because delivering the change required needs a concerted global effort. For King, the scale of change required represents a real opportunity for businesses to innovate and move into new markets, as a range of non-fossil fuel-based technologies will be needed to achieve decarbonisation.
While we cannot forget the urgency of the climate crisis, it’s good to know that there’s real progress being made towards a cleaner energy future – such as:
If you have any questions about any of the updates we’ve discussed or how they might affect your business, our team of experts is on hand to answer them. Simply call us on 0330 053 8620 or email us at heretohelp@brytenergy.co.uk.
