Good afternoon ladies and gentleman,
It’s great to be here today in Birmingham and I’m only sad that I’m only here for a short time and can’t go round your marvellous stalls and see some of the innovations that are obviously here today, which look incredibly useful.
You’re going to be full of talk on smart ways of doing things and actually the NEC isn’t new to all of this because it’s won a sustainability award twice. It’s using smart metering to save water and energy and these conference centres are popular because they’re so malleable.
I think last week it was the international doll’s house show and next they’ve got recruitment agency experts so culture and services, both important and successful industries in Britain.
Now there’s a constant which we all prize and that’s foresight because seeing the way forward in terms of energy which has to be smart and that means conserving energy, measuring energy and crucially it means storing energy.
I think I’m speaking to the converted with this particular gathering. You represent some of the most forward thinking energy organisations, people who have seen that the future is a mix of suppliers, low carbon and energy storage where all the time technology is improving.
We’ve seen success in storage around the world, from Hawaii to Hamburg and it’s obvious from turnout today that the United Kingdom is now exploiting these opportunities.
Like North Star Solar, who are offering integrated solar, storage and lighting systems to installers at no upfront cost. And Hounslow installing storage alongside solar panels to cut their bills.
This is promising and we are proud of it so thank you.
I’ve been asked to speak about where the UK is heading through 2020. The very obvious answer and one that was discussed thoroughly during the party conferences is that we’re heading out of the European Union, but this shouldn’t be alarming.
The economic outlook is constantly being revised and has been improving. I believe we’ve been given an important opportunity and if there is any test of government’s foresight, it will not only be how we navigate through the forthcoming agreements but how we continue to prosper as a country with industries like yours.
So although the UK is leaving the EU, we remain one of the best countries in the world to do business in and with. And crucially we remain one of the world’s leaders when it comes to tackling climate change.
Throughout the agreements in Paris, our negotiating team was one of the best and helped bring together diverse countries into the agreement.
Out Climate Change Act and our carbon budgets will implement our share of the actions that 194 countries agreed to in Paris and as we prepare to ratify this year, and that was referred to today by our new Prime Minister, our commitment to climate change has not wavered.
You’ll have a role to play in that because climate change doesn’t get solved by parliamentary decisions alone; it gets solved by everyone playing their part and doing things.
I’ve been at conference since Sunday, soaking up debates particularly on energy, and I’ve been emphasising that there is an important part in the energy mix in the UK for solar because we need a diversity of energy supply. Diversity is very important in energy.
Solar is especially valuable for direct heating whether in households, businesses or factories. I used to work for Tesco for 15 years and we used it on our depos and supermarket groups in California, in Thailand, in Hungary – we called them green stores in those days.
But solar still needs to be subsidised so if we can work with you to reduce costs further, as I know you’re all trying to do, and if we can get to a place where it can be stored for electricity, solar is a technology and an industry that can step change.
Batteries, solar panels, wind turbines; all of these can help integrate low carbon generation whilst delivering secure affordable electricity for customers and these techniques allow us to save energy, store it for when we really need it and be more flexible in the sources it comes from.
My background as a business woman is in retail – working in Tesco for 15 years and as an executive on the Board for the last six years – and an important part of our strategy was to expand what the supermarket provided.
So when I arrived people would leave Tesco with a bag of groceries but by the time I left, customers had the choice of shopping online, signing up for a new phone contract, getting insurance, buying fashionable clothes for their children. We even built a zero carbon store.
So I know that to survive in the market, it’s about adaptability. You need to be able to adapt and to constantly be thinking of ways to improve your product and improve your service.
So it’s no surprise that the retail sector is redefining itself, with companies such as Sainsbury’s and M&S installing solar panels on a large scale and so supporting the decarbonisation of their businesses.
Recent policy changes have rightly made sure that support for solar remains in line with the falling cost of panels – affordability is very important. We continue to see new projects being presented, even at the heart of our existing manufacturing industries.
Take a great British name, Rolls Royce. The Rolls Royce factory in Bristol has instigated ‘Project Sunshine’, installing solar panels which will play an important part in their 50% emissions reduction, as well as powering their facilities.
Meanwhile leading solar companies, great innovators such as Lightsource, are working hard to develop the subsidy-free solar models of the future.
I expect you know this but there are 840,000 UK homes with solar panels and that contributes 2.2% per cent of UK generation now, so that’s actually a really significant contribution.
Well-planned storage can be a solution to converting the low carbon electricity into secure-low carbon electricity. It can help those solar households maximise their energy use, giving them power over how they use that energy and taking demand away from the grid at times of low demand. So these changes to the demand side are also obviously an important dynamic.
And up to 18GW of storage could – according to the National Grid’s Future Energy Scenarios – be connected to our energy system by 2040. So we’re talking some big numbers
So to exploit this further, we need your help: we need your expertise and investment and your innovation to bring forward the business models that will deliver a new smart energy system. It’s important, too, that we look at how our international counterparts are exploiting storage to its fullest potential. I’ve told you about opening our eyes even more broadly following Brexit.
For example in Los Angeles, where a major gas leak is being mitigated by hundreds of MWh of storage, or in India where the Solar Energy Corporation will require storage alongside solar panels in new tenders to help manage their power fluctuations.
This is where foresight comes in.
My colleague the secretary of state for business, energy and industrial strategy, Greg Clark, outlined the principles of that strategy recently.
And for today as well as highlighting the importance of innovation in that strategy, he made a point in that speech which strikes a chord today. He talked of how in our society, we need to have an upgrade culture: our phones, our computers, our industrial processes – they’re all subject to regular upgrades and this is a feature of the digital economy.
He talked about it being time for our country to have an upgrade, one that puts it in a good place to tackle problems when they occur.
For me, it is crucial that the market and structures which support the new technologies I’ve been speaking about today are fit for purpose now and regularly upgraded in the future. I know from my business experience that implemented change is very important.
So we are actively supporting the UK storage industry through our innovation programme.
Over the last six years, the government and other public bodies have committed more than £65m to energy storage research, development and demonstration, because that’s important too.
Ofgem have provided more than £100m to the UK Distribution Network Operators who help test energy storage in conjunction with solar arrays.
And in the 2016 Budget, the Government committed at least £50m of funding to support innovation in demand-side response, which I was touching on earlier and am very interested in, in storage and in smart technologies.
We are focusing on developing our Smart Innovation programme to use this funding. We want to support technologies where there are clear market failures and programmes where intervention will have the greatest impact, particularly on meeting our climate change and energy objectives.
We will be seeking your views on the options in the months ahead. Please give us feedback, you have a lot of expertise which I can see today.
We have seen some great success stories.
Moixa has developed their Maslow domestic battery system, assembled in Hastings and that provides grid support services delivering cost savings for consumers.
Connected Energy, who I think are here today, received funding for their well-named Everest Project. It will demonstrate how recycled batteries from electric vehicles can provide storage solutions for the distribution grid; which we need, to help manage the output from renewables and support the rapid expansion of electric vehicles which looking forward are going to become a much more important industrial dynamic.
The UK enterprise redT has recently supplied 40kWh flow battery systems to E.ON who I met this morning and other UK and international customers.
I believe these technologies must be encouraged and supported, so that more of us can benefit from disruptive change that we’re seeing and which is helping to create a revolution. That is why we will shortly publish a call for evidence on a smart systems routemap, including sections on storage and innovation.
We will need your help in choosing the solutions that work best for the industry, for consumers and communities. We’re trying in the new government to have a better sense of place across the UK, it does seem to me that the energy industries being so wide spread are very helpful in that context.
The theme of this session is ‘Changes and Opportunities’.
Every change is an opportunity. Brexit will be a significant change, but we have an opportunity in the new relationships we make in a different world.
Climate change is a change but we have an opportunity to build new industries that cut carbon and use energy in a smarter way and to invest in innovative, sustainable energy projects like storage.
But every opportunity doesn’t mean change.
By making energy storage more commonplace we can have more stability – we can keep power in our towns and cities flowing when other sources are under pressure, which means a lot as energy minister when you need to keep the lights on. And we can provide cheaper electricity for business which will make our economy stronger an d more competitive.
Ladies and gentlemen, we have seen what can be achieved when government and business work together in collaboration. I want this to continue and I believe our joint vision should be a smart energy system in the UK, one that could be the envy of the world.
Thank you for listening.