The UK government has decided to accept amendments to the Energy Bill that will give Ofgem a statutory duty to help meet the goal of Net Zero carbon emissions by 2050.
In April, the House of Lords added the amendment to the Bill, but it was uncertain until yesterday whether the government was minded to accept. An amendment to the Energy Bill (Gov NC52) was published today in the name of junior government minister Andrew Bowie, who is responsible for energy systems and networks. The legislation is still at the committee stage in the Commons.
Ofgem said it welcomes the amendment to the Energy Bill, which it said will “restate Ofgem’s principal objective to protect the interests of existing and future gas and electricity consumers.”
Ofgem’s mandate will include “reference to the net zero targets and 5-year Carbon budgets in the Climate Change Act 2008,” which will replace wording on greenhouse gas emissions.
Ofgem chief executive Jonathan Brearley said: “Ofgem welcomes this mandate which brings us in line with the UK Government’s legal obligations and, for the first time, directly links consumers’ interests to specific net zero targets”
“The mandate sends a clear message we must end our historic dependency on fossil fuels and stop our exposure to volatile global markets. We’re laying the foundations for the energy system of the future. The net zero mandate has overwhelming backing from every part of the energy industry, consumer campaigners and climate activists,” Brearly added.
The new duty will come into force two months after the Energy Bill gets Royal Assent.
Trade body RenewableUK responded to the decision, saying that the new mandate would also help to connect clean energy projects to the grid faster. RenewableUK head of public affairs Nathan Bennett tweeted:
Big news – Government have agreed to reform the remit of Ofgem to include a Net Zero duty 👇— Nathan Bennett (@nathansbennett) June 6, 2023
Great news for billpayers and the planet!https://t.co/cSlOkBgkNa
RenewableUK’s director of future electricity systems Barnaby Wharton said, “the Government’s landmark decision to give Ofgem a new duty to deliver net zero is essential to change how we prioritise building vital new infrastructure to connect clean energy projects to the grid.”
“We’ve been calling for this key amendment as a matter of urgency to tackle the glacial pace at which grid is approved and built. Some offshore wind projects are having to wait for more than ten years to get a grid connection. This measure will help to unlock at least £15 billion of investment in offshore wind alone between now and the end of the decade,” Wharton added.
Former Conservative Minister Chris Skidmore, who chairs the Net Zero Review, also welcomed the news, saying it was “a key recommendation of the #NetZeroReview #MissionZero and a policy I’ve continued to campaign for along with many others who made the case during the review”.
Delighted that @ofgem will now be given a net zero duty. This was a key recommendation of the #NetZeroReview #MissionZero and a policy I’ve continued to campaign for along with many others who made the case during the review https://t.co/7rvq7xeEBq— Chris Skidmore (@CSkidmoreUK) June 6, 2023
Greenpeace UK Political Campaigner Ami McCarthy said it was “the 1st BIG step to upgrading the grid & electrifying the UK”.
GOOD NEWS 🎉— Ami McCarthy (@Ami_McC) June 7, 2023
Currently our power grid cant handle the amount of renewable energy we produce – wind turbines have to be switched off & the cost is passed to consumers (£806m 2020-21).
This is the 1st BIG step to upgrading the grid & electrifying the UK ⚡️https://t.co/NR8LitP6Kj
The news was also welcomed by Solar Energy UK, who said, “Though indirect, Solar Energy UK expects the change to result in a faster rollout of grid-scale solar projects, which can be subject to long delays in connecting to the electricity grid. This should result in lower consumer bills, faster decarbonisation and more investment, jobs and economic growth.
“This was a common-sense decision by the Government. The era of costly renewables is long gone – consumer and environmental interests are now one and the same,” said Chris Hewett, chief executive of Solar Energy UK.
“The new amendment reflects the close relationship that we have with the Department for Energy Security and Net Zero, working together to run the new Solar Taskforce. There is a general consensus that slashing waiting times for grid connections is the body’s greatest priority,” Hewett added.