May 10, 2021

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Net zero payment in the UK undermined by the power grid disrupting renewables

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Industry figures and lawmakers have said efforts to tackle the climate crisis are being undermined by an outdated energy grid and outdated planning rules that discourage investment in renewable energy.

Renewable energy developers warn that an old network of towers, transformers and cables, designed for the era of large fossil fuel stations, is limiting the spread of green energy. They say it is no longer possible to build additional supplies in parts of the country because network connection costs are so high.

The call for reform comes as members of parliament on the environmental audit committee this week wrote to Business Minister Kwase Quarting urging renewal of support for small community energy projects that have suffered from the withdrawal of a raft of government subsidies.

The committee said that despite the government’s commitment to reach net zero carbon emissions, domestic power generation in the UK is not growing, unlike Germany, Denmark and the Netherlands.

“Network connection costs and access fees can be very high for small groups and do not take into account the broader benefits of decarbonization – including education and social support – that enterprises bring to their communities compared to trade and renewable projects,” wrote Philip Dunn, chair of the committee.

The committee wants ministers to reform planning rules to force councils to engage with community energy groups and prioritize local power generation.

Commercial developers are also calling for reform to make getting renewable energy to the grid cheaper.

One of the major problems is that gas power plants usually have access to a certain amount of grid capacity, whether or not they are generating power at a certain time. Hence, renewable energy suppliers are not able to use it even if capacity is not utilized.

The developers argue that these contracts should be renegotiated to allow a fairer and more flexible use of existing capacity.

More wind and solar developers have joined the grid more recently than fossil fuel suppliers, under contracts that allow grid operators to cut supplies when there is excess power being generated.

This usually happens when it is very sunny or very windy – the times when renewables are most profitable.

Investors in the new energy supply also have to pay the companies that operate the grid to modernize the local infrastructure, which can be prohibitively expensive.

Recently, £ 40m was quoted to a renewable energy developer to link the development of new solar and battery storage that was expected to cost £ 10m.

Tom Edwards, a consultant at Cornwall Insight, a renewable energy consulting and research firm, would like to see change, too.

“The way the grid shipping arrangement was built took place in the 1990s when it was believed that we would build gas forever,” he said.

He explained that fossil fuel suppliers have “reserved connections” of an already overburdened energy grid.

“So, if you are in an area that already has a lot of solar farms and no spare capacity, you have to pay to build more networks to get more power.”

If renewables developers do not want to spend millions in order to upgrade the grid so they can connect, they can agree to flexible connectivity which means they can get stuck on the system when there is too much energy being generated.

The key question, Edwards said, is how the cost of adding new capacity is shared between renewable energy developers – who build and benefit from it – and society as a whole through taxes and electricity bills.

He said that old agreements between fossil fuel stations and grid operators could be renegotiated so that capacity is not reserved all the time but is flexibly allocated and can be used by renewables when the gas power plants are idle.

This will free up space on the grid and allow for a more equitable distribution among all types of energy. The plan will encourage investment in renewables but also require compensation for power plants that are losing out.

Ofgem argues that the flexible connections for new developments do indeed offer a fair compromise, allowing more supplies to be added at a lower and faster cost than would be the case if only secured connections were available.

Flexible connections make it more efficient to use the existing network, which means developers don’t have to pay much for upgrades.

The regulator is currently studying ways to improve access to the grid, including by increasing investment in local renewable energy on a smaller scale.

However, there is no comprehensive agreement across the sector about where the problems lie and how to fix them.

Hugh Taylor, chief executive of Roadknight Taylor, a leading network communications consultancy, said that while network capacity is indeed the single most important factor hindering energy decarbonization, renewable energy developers themselves must bear some responsibility.

Often times when developers are told they have to pay millions of pounds to plug in a new power supply, “it’s because they’re introducing the wrong application in the wrong part of the network,” Taylor said.

While some areas have seen a lot of development and are now very crowded, others provide much easier opportunities for communication. In some regions, only 8 percent of applications go to connect new supplies to the grid. By contrast, Roadknight Taylor boasts a 90 percent success rate nationwide.

The key, he said, is to assess the specific technology requirements and cost at each site.

He added that the presence of a gas power plant was unlikely to be the main reason for telling renewable energy developers that they would have to pay large sums if they wanted to connect.

“You have very little interference with the gas, wind or solar coil. When the wind is blowing or the sun shines, it is very unlikely that this gas power plant will generate.”

Meanwhile, Mr. Taylor said the technology that manages the use of any energy supply has advanced rapidly and Britain is the “world leader” in this area.

“Smart grid technologies enable the delivery of many more megawatts of renewable energy sources, and where you have diversity in technology, battery, wind, solar energy, and smart grids, this means you can connect a lot.”

He added, “There may be some level of downsizing [of renewable supply] Where this interference is present but the gas scheme is in place to keep the lights on. This is when needed. “

The Renewable Energy Association, which represents more than 550 companies in the sector, is calling for reform.

“The current power system is mostly designed around large central generators,” said Mark Somerville, Head of Energy and Resilience at REA.

“While major steps have been taken to decarbonize energy so far – the UK has recently had its greenest days ever – the UK will have to quickly move to a more decentralized and flexible approach to decarbonizing the rest of the system.

“Renewable energy sources and energy storage systems must be able to connect to the grid easily for this to happen.”

A spokesperson for Ofgem said: “In February we confirmed plans to allow local electricity distribution companies to move forward with new new opportunities for green investment.

“This initiative could see an investment of around £ 300 million over the next two years, with accelerating work to start a green recovery and investing in environmentally friendly infrastructure, enabling more local renewable energy generation to connect to the grid and support a larger grid capacity for charging electric vehicles on highways. And major transportation hubs.

“This means that more smaller developments with renewable generation or battery storage capabilities will be able to supply power to the system during periods of peak demand.”