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Industry News Roundup February 2019

Thursday 28/02 – The government publishes its response to the Capacity Market (CM) Technical Consultation which closed on 10 January. The CM scheme is designed to guarantee the UK’s security of supply and was suspended in November 2018 following a ruling by the General Court of the European Court of Justice that it violated EU state aid rules. The government says it has laid draft regulations that, when in force, will make the necessary changes to conduct a replacement capacity auction for delivery in 2019/20. Business and Energy Secretary Greg Clark explains that the government “will shortly consult on regulatory changes that will be required to hold a T-3 auction in early 2020”. The T-3 auction is to provide capacity three years in the future. The BEIS Committee launches an inquiry into the outlook for future investment in UK energy infrastructure, including how to facilitate investment in flexibility and low carbon solutions.

Wednesday 27/02 – Energy and Clean Growth Minister Claire Perry tells a Lords EU Energy and Environment Sub-Committee evidence session that the government is working to develop a domestic carbon emissions trading system that will connect to the EU Emissions Trading Scheme from January 2021. Aggregator LimeJump is to be acquired by Shell. Aggregators are companies which work with smaller flexibility providers to group them together so that they can take part in demand-side response provision.

Tuesday 26/02 – A Parliamentary Science and Technology Committee hearing sees industry urge government to act on decarbonising transport. Scottish Power announces its plans to spend up to £6bn in the UK in 2022, including £2bn in 2019.

Monday 25/02 – Utility Week reports that the government is to publish its energy white paper in “early summer”. The energy white paper was previously announced by Business Secretary Greg Clark in November 2018 with a view to it being published in 2019. Clark said the paper would set out the government’s overall strategy towards energy going forward. As reported by Energy Voice, new research finds that carbon emissions are falling in 18 countries, with the reduction greatest in those countries that have implemented renewable energy and energy efficiency policies. The 18 countries include the UK and the US, with declining emissions partly attributed to the impact of the 2008 financial crash.

Friday 22/02 – A National Infrastructure Commission report praises progress in the UK on flexibility but says the legal status of energy storage is the “biggest remaining barrier”. As reported in Business Green, President of the European Commission Jean-Claude Juncker announces that a quarter of the EU’s budget for the period 2021 to 2027 would be spent on tackling climate change.

Thursday 21/02 – The European Commission (EC) opens its investigation into whether the Capacity Market is in line with EU state aid rules. In a statement to Parliament, Business Secretary Greg Clark says the government will work closely with the investigation. As reported by Current, distribution network operator UK Power Networks announces that it plans to hold a £12mn auction to procure flexibility services in the South East and East of England. Flexibility can enable energy consumers such as businesses to change their consumption behaviour or use onsite generation to help balance the grid during times of high demand and benefit from cheaper electricity.

Wednesday 20/02 – As reported by Power Technology, a new report from the International Renewable Energy Agency calculates that 85% of electricity generation will need to come from renewables by 2050 if the Paris Agreement targets are to be met. This growth, which is expected to cost ~$18trn, includes wind and solar generation growing to account for 60% of generation by 2050, up from just 4.5% in 2015. The report also recommends that a similar amount of investment would be required to update infrastructure and flexibility options. Coal mining and trading company Glencore announces that it is capping its global production of coal citing climate change concerns.

Tuesday 19/02 – Labour leader Jeremy Corbyn calls on the government to ensure the UK achieves net zero emissions by 2050 “at the very latest”. Committee on Climate Change Chairman Lord Deben says, in a letter sent to Energy and Clean Growth Minister Claire Perry, that the government should not carry forward the surplus emissions from the second carbon budget. To do so, he says, would make it difficult to meet the UK’s 2050 emissions target.

Monday 18/02 – The National Infrastructure Council launches a call for evidence on future changes to ensure industry regulation supports innovation while keeping costs low. Energy UK publishes its latest monthly electricity switching figures, including both domestic and business customers, finding a monthly fall in January 2019 but nevertheless buoyant numbers.

Friday 15/02 – BP’s annual energy outlook report predicts that renewables will become the world’s main source of power by 2040. The government publishes Emissions of Air Pollutants in the UK, 1970 to 2017, showing that there has been a long-term decline in air pollution between 1970 and 2017.

Thursday 14/02 – Utilitywise announces that it has gone into administration. In a statement on its website, the energy broker for small businesses says it had been unable to raise sufficient funds to cover its debts and a plan to sell the business had fallen through. In a Written Statement to Parliament, Business and Energy Secretary Greg Clark offers an update on the nuclear sector after Brexit. Clark says that the government continues to put in place “all necessary measures” regarding nuclear operations and Euratom withdrawal. Additionally, he reports that “significant progress” has been made on establishing a domestic nuclear safeguard regime with new regulations on track to start on EU exit day. He said the government would continue working with industry to prepare for any issues that could arise “in any exit scenario”.

Wednesday 13/02 – A House of Lords EU Energy and Environment Sub-Committee evidence session on the impacts of Brexit on UK carbon pricing sees several stakeholders advocate a domestic emissions trading system linked to the EU ETS. Clean energy supplier Good Energy agrees a partnership with battery storage specialists Belectric and Powerstar concerning its commercial battery storage offering.

Tuesday 12/02 – The House of Lords Economic Affairs Committee holds a one-off session on nuclear energy with Professor Dieter Helm and Nuclear Industry Association Chief Executive Tom Greatrex. The government confirms it will not issue or auction any 2019 EU Emissions Trading Scheme (EU ETS) allowances until further notice. BEIS announces it will be increasing funding for carbon capture, usage and storage projects to £24mn.

Monday 11/02 – NextEnergy Solar Fund (NESF) agrees a power purchase agreement (PPA) with solar asset manager Zestec Asset Management to install commercial solar across the UK. A PPA is a contract between an energy generator and an organisation looking to buy energy, which guarantees that the generator will supply energy at an agreed rate for a set period of time. A new report from Octopus Energy Investments concludes that the UK and Europe are the most attractive for both current and future renewable energy investment, based on a survey of global institutional investors.

Friday 08/02 – Drax says that the first bio-energy with carbon capture and storage (BECCS) pilot project of its kind in the world, located at its North Yorkshire power station, is now capturing carbon dioxide. Energy company SSE publishes a trading update for the quarter ending 31 December 2018. It said that the suspension of the Capacity Market (the scheme to ensure UK security of supply) means that it is unlikely to receive the £60mn income it is owed before the end of the financial year 2018-19 and has therefore led it to reduce its full-year forecast for expected adjusted earnings per share for 2018-19 by around 6p, to between 64p and 69p.

Thursday 07/02 – Government data finds support for renewables has fallen from an 85% peak in March 2018 to 77% in December 2018, while awareness of the concept of clean growth has continued to fall. EDF Energy announces that it is to end generation at the 2,000MW Cottam coal-fired power station in north Nottinghamshire from September, citing “challenging market conditions over the last few years and the context of the drive to decarbonise electricity generation”.

Wednesday 06/02 – Business and Energy Secretary Greg Clark tells the MPs on the Business, Energy and Industrial Strategy Committee that the Regulated Asset Base (RAB) model for nuclear projects is under active consideration and confirms that the government has no plans to nationalise the suspended Wylfa Newydd project. The RAB model means that investors can receive returns on a project before it has been completed, helping to mitigate the construction risks of the project. Energy company E.ON announces that it has entered a partnership with vehicle leasing firm ALD Automotive to develop electric vehicle charging infrastructure for corporate sites and homes.

Tuesday 05/02 – Government greenhouse gas emissions statistics show that the UK has met its second carbon budget (covering 2013-17) and that from 2016 to 2017 overall emissions decreased by 3%, with energy supply accounting for the greatest reduction. A new report by the Oxford Institute for Energy Studies concludes that the EU’s gas sector has failed to convince governments, NGOs and the media that it can achieve post-2030 decarbonisation targets.

Monday 04/02 – More than 30 global corporates pledge to replace their road fleets with electric vehicles (EVs) as part of the EV100 initiative, which targets 2mn EVs by 2030. A group of six trade associations has responded to the energy regulator Ofgem’s Targeted Charging Review consultation, arguing that the changes proposed would result in “a year or two with limited network benefits for flexibility and storage”. Flexibility can enable energy consumers to change their consumption behaviour or use onsite generation to help balance the grid during times of high demand and benefit from cheaper electricity.

Friday 01/02 – The UK Offshore Wind Industry Supply Chain Review recommends clear targets from the government for the scale of offshore wind deployment, with developers encouraged to publish clear life-cycle plans. Business Green reports that the UK low carbon and renewable energy economy grew at close to 7% in 2017.

Written By Graham Paul


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