Molly Lempriere, UK editor, Current±
Predictions over the last few years have become a risky business, with curveballs, political upheaval and U-turns abounding in the energy sector and beyond.
That said, there are some key themes I expect to continue over the coming years, not least the volatility.
2022 has been a year marked by it, with record high and low power prices driven by record high and low renewable generation for example. Given the continued constraints caused by high international gas prices, nuclear shutdowns in France impacting interconnector availability and intermittency of renewables in particular over winter, high prices over the beginning of the coming year in particular seem likely.
I predict that the record high for EPEX Day Ahead prices will pass the £3,000/MWh mark, while Balancing Mechanism prices will also see new heights.
With wholesale prices so high, and the Energy Bills Support Scheme coming to an end in March it seems certain that there will be unprecedented levels of fuel poverty seen in 2023.
Less of a prediction and more of a call for action from me, is that the Government moves to support the most vulnerable and in particular, finally takes meaningful steps to rolling out the energy efficiency measures that could literally insulate the public from high power prices.
Amid the undoubted challenges of the next year however, I do think we’ll see the renewable energy sector go from strength to strength. Given the demand for energy security, the need for decarbonisation and the low cost of the technologies, momentum seems unstoppable.
This will likely supported by the removal of the de facto ban on onshore wind, which could mean that we see a much larger proportion of onshore wind projects put forwards during the fifth allocation of the Contracts for Difference round.
While the transition to cleaner, greener fuels may seem inexorable, the transition to electric vehicles (EVs) may run into greater challenges in 2023, as the supply chain constraints that have been looming large in recent years finally starts to bite.
Beyond my thoughts, we asked the rest of the Solar Media editorial team to look into their crystal ball, and provide their key predictions for the energy transition in 2023.
Andy Colthorpe, editor, Energy-Storage.news
Pivotal groundwork laid for long-duration energy storage
It’s not easy to foretell the future at the best of times but given the topsy-turvy nature of the last couple of years in clean energy, it seems more challenging than ever in some ways.
That said, I’d like to offer my predictions, such as they are, made in hope as much as expectation of what I’d like to see.
So, I think there will be some quite significant regulatory and market design activity done to accommodate long-duration energy storage (LDES) resources of several hours or more. A lot of groundwork was laid in the past couple of years, for which the industry and its allies must be commended for their hard, hard work.
However, and it isn’t always the case that the government gets things right, it must be said that on this topic, they appear to be listening, even if the topic itself doesn’t make mainstream headlines too often.
Realistically, we’re unlikely to see something comprehensive introduced this year, such as the ‘cap and floor’ schemes to incentivise market deployment of LDES some have proposed. It’s probably still too early for that, but 2023 will see some pivotal groundwork laid and fruits of pilot and demonstration projects of the recent past will provide valuable learnings towards that endeavour.
Finally, another mini prediction is that lithium battery and materials prices will remain higher than people expected, for a little while longer.
Folks with an eye on the international industry far wiser than myself have offered this view, so I can’t take any credit for the insight. But that ongoing volatility in lithium prices might accelerate the commercial development of radically improved lithium batteries such as solid-state, or other chemistries altogether, such as sodium-ion (Na-ion).
Andre Lamberti, editor in chief, Solar Media
International solutions and techniques
I predict that in 2023 there will be a distinct rise in interest in solutions and techniques for very effective solar panel recycling, and that this will be led by North American and European companies as opposed to Chinese ones.
Jules Scully, section editor, PV Tech
More cross-border renewables efforts
Efforts are gathering pace to harness renewable energy generation in areas with high levels of wind and solar resources, taking advantage of high-voltage direct current (HVDC) cables to connect with demand centres. Earlier this week the UK signed a deal with the European Union that could see the partners develop projects linking electricity interconnectors and wind farms. Elsewhere construction is set to begin in 2024 on a project that will feature 7GW of solar PV, 3.5GW of onshore wind and 5GW/20GWh of battery storage in Morocco that will be connected to the UK by 3,800km HVDC interconnector route. Expect more project announcements in 2023.
George Heynes, reporter, Current±
Heat pumps finally done right
As previously seen with the failings by the government to create an initiative to rollout heat pumps in 2022, I believe the pressure from the industry and the need to decarbonise the UK’s heat sector will finally see a successful initiative launched by the government in the New Year.
This will be a breakthrough moment for the industry and will see increased/record installations of heat pumps in the UK and spur on further growth within the heat sector to build upon in future years.
Cameron Murray, reporter, Energy-Storage.news
Battery energy storage goes from strength to strength
More UK battery storage developers will follow in the footsteps of Gore Street and invest in other markets like the US and continental Europe. Rising project costs and falls in revenues from ancillary services in the UK because of an increase in competition will mean a fall in returns compared to 2022, and developers will look to offset this by acquiring projects in other markets.
Fusion’s time to shine?
A few more major breakthroughs in nuclear fusion will happen throughout the year, and this will start to affect people’s thinking around renewable energy projects with very long development periods like hydropower or conventional nuclear. Early-stage projects may even be pulled entirely in the hope that nuclear fusion will eventually fill in the gap, especially if its projected commercialisation timeline shrinks thanks to an acceleration in the technology’s development.
Lena Dias Martins, junior reporter, Current±
Heat pumps become mandatory
As decarbonising heat moves closer to the forefront of the UKs net zero target, heat pumps are receiving rising support throughout the renewable sector. In November, the Energy & Climate Intelligence Unit identified slow heat pump installation progress as one of the predominant causes for the UK’s dependence on gas imports.
There are initiatives, like EDF Energy’s new training academy for heat pump installers, arising to help bolster heat pump uptake throughout the UK, but a nationwide policy would have the most impact.
In response to growing pressure from the renewables industry alongside emerging data as to the benefit of heat pumps in decarbonising the UK’s heat, I believe the UK government will expand on its Heat Pump Ready Programme and launch a bill making heat pumps mandatory for new builds from 2028 (or sometime in the near-ish future).
Jonathan Touriño Jacobo, reporter, PV Tech
EVs surge past a million
The sales of pure EV (not including hybrids) in the UK will pass one million by the end of 2023. If we take New AutoMotive’s numbers as of November 2022, which has EV at 568,000 it means in 2023 there will be more than 400,000 EVs sold, more or less doubling the numbers in 2022.
Will Norman, junior reporter, PV Tech
Floating solar has its moment
With the need for increasing levels of renewables, but concern over land use remaining, we’ll see more installations of floating solar in the UK over the next year, along with the rooftop market going from strength to strength.
The Current± Predicts series will return for 2023, with a host of energy experts already lined-up to take part. Want to put your crystal ball to the test? Get in touch with [email protected] to find out about how to take part
