This year has been full of twists and u-turns, but the UK energy industry has persevered relentlessly towards a net zero trajectory.
To celebrate the energy industry’s collective efforts, Current± outlines some of the top decarbonisation successes of 2023 in the UK featuring reflective comments from key industry players.
Supply
World’s largest offshore wind farm connects to UK grid
In October the first of three 1.2GW sections of Dogger Bank was connected to the UK grid and began exporting electricity for the first time.
Although only partly operational at the moment, Dogger Bank, developed by SSE Renewables, Equinor and Vårgrønn, is expected to have an output of 3.6GW once it begins full operation in 2026.
This will make it the largest offshore wind farm in the world.
Dogger Bank is split into three equal 1.2GW parts (Dogger Bank A, B and C), A is now connected at the Creyke Beck substation, with Dogger Bank B to follow suit, whilst C is set to plug into the National Grid’s Lackenby substation.
With the world’s largest offshore wind farm now exporting energy back to the UK grid, the project sets the stage for the UK to continue being a powerhouse for this technology, providing clean and green energy to households.
First Demand Flexibility Service events of this winter take place
Both the first and the second demand flexibility services (DFS) mark one of the biggest achievements, not only in 2023, but for the decarbonisation of the UK’s energy system as a whole.
The first DFS service ran from 1 December to 31 March and would see 22 service events set by National Gird ESO indicating periods of constraint on the grid and requesting consumers reduce their demand to help alleviate strain on the grid.
In May 2023, it was revealed that the first DFS displaced over 3.3GWh of electricity during peak periods.
This success led to the National Grid ESO announcing in September that the scheme would return over this winter period, running between November 2023 and March 2024, consisting of 12 test events alongside the potential use of “live” sessions.
So far there have been two live events for this winter’s DFS, one on 30 November and the other the following day 1 December.
Claire Dykta, director of markets at the ESO, called the DFS a “real success and a testament to the hard work of colleagues across the ESO and wider industry partners.”
“Across this winter and last, we’ve seen millions of households and businesses directly participate in demand side flexibility for the first time, earning pounds, points or prizes for doing their bit to reduce or shift energy usage,” Dykta continued.
“The launch of DFS in November 2022 was a breakthrough moment for our industry, and we hope to see this momentum grow further as system flexibility becomes the norm for Great Britain.”
Emobility
ZEV mandate agreed in parliament
After much deliberation the zero emission vehicle (ZEV) mandate was passed into law on 4 December 2023, coming into force on 3 January 2024.
Following the end of the ZEV mandate consultation in May 2023, the automotive industry had expressed its concern as the year drew to a close and a finalised mandate draft was yet to be seen.
At the end of September, however, the final ZEV mandate was revealed confirming the delayed ban on the sale of new internal combustion engine (ICE) vehicles from 2030 to 2035, as announced by Prime Minister Rishi Sunak earlier that month.
The finalised mandate confirmed that by 2030, 80% of new cars and 70% of new vans sold in Britain must be zero emission, and by 2035 all vehicles must be electric.
49% increase in UK EV public charging infrastructure
As electric vehicle (EV) uptake in the UK grows, so does its charging network. Thanks to the unwaning efforts of the EV industry, there has been a 49% increase in the public charging infrastructure year-on-year (YOY) with over 50,000 chargers across 30,000 locations.
Confirmed by the emobility service provider Zapmap in October, the 50,000th chargepoint to be installed in the UK was an ultra-rapid device operated by chargepoint provider MFG EV Power.
En-route high powered charging saw a significant boost, increasing by 49% with 10,000 rapid and ultra-rapid chargepoints installed across 5,000 locations.
According to Zapmap data, ultra-rapid chargepoints saw the most significant growth this year, increasing by 96% year-to-date.
“The UK’s charging infrastructure has taken great strides forward in 2023 with a 44% year on year growth rate. The growth has been particularly strong for high powered en-route charging to support EV drivers on longer journeys,” Melanie Shufflebotham co-founder and COO of Zampmap told Current±.
“The trend is set to continue with chargers increasingly high powered 150kW or more and found in hubs of six or more chargers.”
“This expansion of the network, combined with improved reliability and rollout of simple payment solutions in apps such as Zapmap, will provide a better charging experience for current EV drivers and the hundreds of thousands who are primed to make the switch in 2024.”
Tech
UK government supports green sector manufacturing via £960 million package
In late November the UK government unveiled a new £960 million funding package to boost clean energy sectors including EVs, offshore wind and battery energy storage systems (BESS).
Allocate to a Green Industries Growth Accelerator to support manufacturing in the clean energy sector, the funding was a welcome package for British manufacturers.
Technologies that are set to be supported via this accelerator include EVs, electricity networks, carbon capture, utilisation and storage, hydrogen, nuclear and offshore wind.
The UK government’s expression of commitment to clean energy manufacturing in the UK comes as a relief to its energy industry, demonstrating certainty in the UK’s renewable future in light of fierce international competition for clean energy investment.
Boosts for batteries
The UK’s battery industry has seen a number of regulatory wins in 2023, not least the UK Battery Strategy which was released last month (November).
Outlining 15 measures to create a “globally competitive battery supply chain that supports economic prosperity and the net zero transition” in the UK, the strategy also included funding for the technology in the form of £61 million allocated to battery R&D through three channels: the UK Battery Industrialisation Centre, the Advanced Materials Battery Industrialisation Centre, and 20 competition winners developing technologies across the battery value chain.
Britain’s battery pipeline has also seen an increase in operational capacity of over 60% this year, according to Modo Energy, growing from 2.1GW at the close of 2022 to 3.4GW.
Commenting on the growth of the UK’s storage pipeline, Wendel Hortop, markets lead at Modo Energy, said: “While revenues have fallen from the record highs of 2022, investment in new battery energy storage capacity has shown no let up with a record 1.3 GW of new capacity coming online in 2023. This is an increase of 65%, and takes total grid-scale operational battery capacity in GB to 3.4 GW.”
Regulation
Energy Act
Described as the “biggest piece of energy legislation in the UK’s history” by the Energy Networks Association (ENA), the Energy Act received royal assent on 26 October this year.
Now law, the act outlines major changes to the UK energy system to facilitate net zero. Many of these changes are aimed at making the UK energy system more equipped to manage the growing number of electric technologies being added as the UK tries to reach net zero.
A key focus of the Act is increasing competition in Britain’s onshore electricity networks through a newly introduced tender process which, according to the government, will reduce costs for network operation and development and save consumers up to £1 billion off their energy bills by 2050.
The Act received much praise from the energy industry; the Association for Renewable Energy and Clean Technology, for example, expressed their “delight” that the Energy Act had received Royal Assent calling it a landmark legislation that will transform the UK’s energy system.
Emma Pinchbeck, chief executive at Energy UK told Current±: “The passing of the Energy Act was definitely an important step – as the first piece of such legislation for almost a decade – and moves to speed up connections and planning are very welcome if urgently needed but they are also reminders of how much work we have to do to stay on course for our targets and make the most of the opportunities the energy transition could bring.”
Autumn Statement
Another standout regulatory moment came the following month when chancellor Jeremy Hunt unveiled this year’s Autumn Statement.
One of the most welcomed aspects of the Autumn Statement was an exemption on the 45% windfall tax imposed on renewable energy suppliers via the Electricity Generator Levy (EGL) on “extraordinary returns,” which was extended and expanded in the 2022 Autumn Statement.
Following the announcement all new renewable generation projects and extensions to existing projects that have had a “substantive decision to proceed” on or after 22 November will now be exempt from this tax.
Reflecting on the regulatory development for clean energy in the UK, Pinchbeck reflected: “There have been some positive developments for renewables – notably during the second half of the year – but these have to be seen in the context of far more challenging economic conditions for developers and increased international competition for investment.”
“The UK has many existing strengths and we can play to these by committing to a stable policy and regulatory framework. It is vital the government sends a clear and consistent message to industry, investors and customers in the year to come and avoids the sudden changes to policies and mixed messaging that have been an unwelcome feature during 2023.”
Networks
Government responds to Winser report
A full government response to electricity networks commissioner Nick Winser’s independent Accelerating electricity transmission network deployment report – which outlined how Britain can halve the time required to build grid infrastructure – was also announced within this year’s Autumn Statement outlining a connections action plan set to cut grid action delays by 90%.
The eagerly anticipated Grid Connections Action Plan outlines an overhaul that could release 100GW of capacity from the connections queue and cut average connection delays from five years to six months.
One of the biggest changes, in the report, is the decision to move away from the “first ready, first served” approach to replace it with a “first come, first connected” mechanism to ensure speculative and slow projects are removed from the queue.
ESO’s five-point plan
Grid connected to be a hot topic this year, as February saw National Grid ESO release its five-point Connections Action plan to speed up electricity grid connection and cut waiting times for 70% of projects with a post-2026 connection date by two to ten years.
The ESO will also be reviewing contracts to ensure parties looking to connect to the grid in the next two to three years are on track to meet their connection dates, as well as allowing companies to leave the grid connection queue without incurring penalties.
According to the organisation, the latter allowance has already seen 8GW worth of projects interested by May 2023, and it is now working to approve these contract terminations.
“This year Ofgem has worked closely with government and industry to begin streamlining the grid connections process, which is needed to deliver the unprecedented amount of new connections and infrastructure needed to meet the government’s net zero targets,” said an Ofgem spokesperson.
“Alongside government we recently published a joint Connections Action Plan designed to set the framework for dramatically reducing connection waiting times. The Action Plan includes a number of new industry rules and measures aimed at moving away from the traditional ‘first-come first-served’ queueing system. These include a new rule which allows stalled or speculative ‘zombie’ projects to be removed from the connections queue by the ESO, allowing more viable projects to connect quicker.”
Heat
Heat pumps now cheaper than gas boilers
Heat pump uptake received a welcome boost in September when Prime Minister Rishi Sunak confirmed that individual grants for both air source and ground source heat pumps under the Boiler Upgrade Scheme (BUS) would increase to £7,500.
This grant boost came into force on 2 October, making heat pumps cheaper to install that traditional gas boilers.
The higher grant could even cover the whole cost of a heat pump – which typically averages at £7,000 according to the trader platform, Checkatrade – a more attractive alternative to installing a gas boiler, which costs between £2,500 and £3,000.
Clean Heat Market Mechanism
Just before the close of the year (1 December) the Department for Energy Security and Net Zero (DESNZ) confirmed the launch of the Clean Heat Market Mechanism.
To be launched in April 2024, this scheme will require heat pump installations to make up a 4% equivalent of manufacturer gas boiler sales in the scheme’s first year (April 2024 to March 2025), increasing to 6% in the mechanism’s second year – from April 2025 onwards.
Tradable heat pump credits will be earned by manufacturers for each qualifying domestic heat pump installed, if certified under an appropriate certification scheme such as the (MCS), with each manufacturer required to reach a certain point quota at the end of the trading period.
Reacting to the announcement, Charlotte Lee, CEO of the Heat Pump Association said: “We welcome the clarity provided by the publication of the government’s response to the Clean Heat Market Mechanism and acknowledge the adjustments made to the scheme which include; a reduced penalty payment, the ability to carry forward a larger percentage of unmet obligations, introducing a consistent approach in the new build sector and not introducing a multiplier to penalise unmet targets.
“Whilst the sector remains concerned about the impact of the scheme on the market given the lack of supporting policy enablers- such as addressing the imbalance between levies on gas and electricity bills to reduce the price of electricity relative to gas, we are committed to working pro-actively with Government and the Environment Agency to support a smooth implementation of the scheme.”
