REA Calls for 2021 to be a Turning Point for Renewables
Though the UK government has made historic climate promises in the past year, delivery on them has been too slow. New climate strategies have been shrouded in uncertainty and those that have emerged have too often not been unsuccessful. According to a new report from the Association for Renewable Energy and Clean Technology (REA), the UK will not meet its net zero target without additional investment and policy support. Every month of inaction will make it harder for the UK to get on track.
The REA noted in its annual state of the industry report, REview21, that despite the renewable energy and clean technology sector continuing to be buoyant, it was being stifled by a lack of consistent, proactive and long-term support from the government.
Dr. Nina Skorupska CBE, CEO of the REA, said:
“The same goes for employment. Again, we have seen decent progress, with nearly 140,000 people now being employed by the renewable energy and clean tech industry and we believe that nearly 200,000 extra jobs could be created by 2035.”
She believes that the number of new jobs created could be even greater if the government backs the renewables industry properly and puts it at the heart of the UK’s economic recovery. She cautioned however, that these job projections are not guaranteed.
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She went on to say:
“If the sector continues to receive patchy and short-term support from the government then we could fall well short of our sector’s, and, indeed, the country’s economic potential. We need these new jobs to be fairly distributed across every region and country that makes up the United Kingdom too.”
The Prime Minister’s Ten-Point Plan for a green industrial revolution was an important initiative but it has yet to be backed with robust policies. So far there hasn’t been any real engagement with the public as to what changes lie ahead.
It is now critical that the new strategy is published before the COP26 climate summit due to be held in Glasgow, with clear policy plans that are backed by the Treasury. Importantly, though, the new strategy must be accompanied by a commitment to get the country ready for the serious climate risks facing the UK, as the next phase of adaptation planning starts.
According to government statistics, renewables provided a record 43% of the UK’s electricity last year, up from 37% in 2019.
The Department for Business, Industry and Industrial Strategy (BEIS) published that for the first time ever in 2020, increased wind generation meant that renewable energy sources generated more electricity than fossil fuels. Wind generation increased by 18% compared with 2019 which set a record in the annual quantity of power it produced, providing 75.7 terawatt hours (TWh), up from 64TWh in 2019.
Fossil fuel generation fell to a record low in 2020, providing 37.7% of electricity. Gas produced 35.7% while coal fell to just 1.8%.
The pace of growth in new renewable capacity was also thought to be slowing down with just 1GW added in 2020 which was the lowest since 2007. However, the UK’s solar sector appears to be picking up again. Research from Current± publisher Solar Media found earlier this year, that in the 12 months to 21 March 2021, 660MW of new PV was installed, and that there is now in excess of 15GW in the pipeline.
RenewableUK CEO Dan McGrail said:
“This is stellar news in the year that the UK is hosting the biggest international summit on climate change for years. It shows that this country is playing a leading role in the global energy transition, with renewables becoming the dominant source of new power generation – outstripping fossil fuels for the first year ever and setting new record highs across the board. It’s another significant step on the road to net zero emissions, but we need to move even faster and decarbonise the power sector by 2035.”
The Met Office is warning that the UK is already undergoing disruptive climate change and that it is vital that practical action is taken at scale against the biggest threat that we face to our way of life.
The REA are calling for six monthly contracts of difference (CfD) auctions to allow further renewables to come onto the UK’s grid. They want adequate budgeting with a clear rolling timetable for these auctions, as well as new support for small scale projects and the removal of VAT on domestic installations. The Treasury recently revealed that it had no plans to change the VAT levels on ‘green products such as solar panels and heat pumps despite repeated calls from the industry to use such a change to drive growth.
The REA’s report REview21, said that support should be provided for all technologies including bioenergy, which they believe has a “vital value” the government should acknowledge, and that innovation funding should be reformed to enable more renewable and clean technologies to benefit from it.
It is essential for the grid to be reformed to ensure that the UK has an efficient grid network that facilitates renewables and clean tech and aids their growth. The REA would also like to see a definitive decarbonisation priority incorporated into Ofgem’s key performance indicators and activities.
In response to the increasing calls for the decarbonisation of heat to become a priority in the UK, Prime Minister Boris Johnson released his ten-point plan in November 2020. The plan set out a goal of 600,000 heat pumps to be installed every year by 2028. The Green Homes Grant launched in September 2020 was designed to support the installation of energy efficiency measures as well as heat pumps and solar thermal. However, the grant was dropped after just 6 months which led to a rise again in calls for action.
The REA is asking for a coordinated, long-term policy framework to enable the decarbonisation of heat in the UK. The policy framework should support all renewable technologies, and work should be undertaken to close policy gaps for business and industry. The REA thinks that there should be tariff support for the replacement of fossil fuels, funded CfDs for industrial heat decarbonisation and tax benefits.
Impressive progress has been made in recent times to decarbonise the transport sector, according to the REA. This is thanks in part to the growth of the electric vehicle (EV) and hybrid market. Now that there is a ban in place on the sale of new internal combustion engine vehicles from 2030 the growth in EVs is clear to see. Between 2019 and 2020, the market share of new car registrations for EVs and hybrid cars rose from 3.17% to 10.56% the REA said.
The REA believe that the government should look to offer long-term support to the transport sector by maintaining adequate grant funding to overcome areas of market failure and by supporting local authorities to improve charging infrastructure networks.
The REA and Innovas put employment figures together for the renewable industry as part of the finance chapter of the Review21 report. They found that for the financial year 2018/2019, there were 133,977 people employed in the sector, while in 2019/2020 there were 138,264 people employed. This is an increase of 3.2% from 2018/2019.
Once again, the REA think that the right policy environment would make a big difference. They forecast that there could be 222,000 jobs in the renewable energy and clean technologies sector by 2035, more than double employment figures for 2019/2020.
Though the renewable industry is continuing to grow, the REA would like to see further support across the country to make the most of the opportunities green energy growth provides for job creation. Their findings back up a recent call to action from the Green Jobs Taskforce amongst others, for the UK government to support the ambition to create 2 million skilled jobs by 2030.
Dr. Nina Skorupska CBE, CEO of the REA, said:
“If the government is serious about reaching their net zero ambitions, and about ‘levelling up’, they need to back our sector, remove the barriers preventing the growth of our technologies and help us deliver new jobs and investment. 2021, the year the UK is hosting COP26, must be a watershed moment. The time for rhetoric is over, we need to see action.”
We saw UK emissions falling to nearly 50% of their 1990 levels during the 2020 lockdown, but the journey to Net Zero is far from even half completed. Emissions are expected to rebound this year which suggests that lasting progress in reducing emissions is on a very unstable footing. The relative success we have achieved in decarbonising electricity must continue, but it needs to be matched with solid commitments to decarbonise buildings, transport, industry and agriculture.