Clean power 2030 with Joe Bush (Market Analyst @ Modo Energy)
Nov 14, 2024
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Joe Bush, a market analyst at Modo Energy, dives into Britain's ambitious Clean Power 2030 report, which aims for over 95% clean power generation. He discusses the Herculean effort required, with predictions of needing 70GW in new renewables. Joe highlights the vital role of energy storage in addressing grid constraints and explores market changes like zonal pricing to optimize demand. The conversation also touches on integrating gas generation with renewables and the associated challenges, emphasizing the urgent need for a government action plan.
Achieving the Clean Power 2030 targets necessitates doubling renewable energy capacity to 120-130 GW, emphasizing offshore wind deployment's crucial role.
Enhancing transmission networks is vital to prevent escalating consumer costs and ensure efficient delivery of increased renewable energy from production sites to urban areas.
Deep dives
Herculean Growth of Renewables
Meeting the targets set by Clean Power 2030 requires a significant increase in renewable energy capacity in Great Britain, as it aims to more than double the current installed capacity from around 50 gigawatts to between 120 and 130 gigawatts. Achieving this ambitious goal involves ramping up offshore wind deployment to five gigawatts per year, compared to the historical average of one gigawatt annually. This unprecedented build-out requires not only investment but also substantial logistical efforts to ensure that necessary infrastructure supports such rapid growth. Failure to meet these targets raises concerns over both energy security and rising costs for consumers as current balancing costs could skyrocket from £1.5 billion to £12.7 billion annually by 2030.
The Challenge of Transmission Infrastructure
A critical component of achieving Clean Power 2030 is the expansion of transmission networks to deliver renewable energy from production sites to consumption centers, particularly in urban areas. Currently, transmission constraints lead to costly curtailments of wind energy, costing consumers approximately £50 per household yearly, a cost projected to escalate significantly without infrastructure upgrades. The National Energy System Operator (NISO) has identified around 81 projects, including both onshore and offshore transmission lines, intended to alleviate these constraints. Successful implementation of these projects is essential to keep consumer costs manageable and maintain the flow of renewable energy.
Flexibility and Energy Storage Solutions
The transition to a cleaner energy system hinges on enhancing flexibility through energy storage solutions, which is expected to see significant growth by 2030. Current projections suggest that battery storage capacity must increase from around 4.5 gigawatts to between 23 and 27 gigawatts, alongside the development of long-duration energy storage. However, there is a notable absence of incentives and a structured approach for developing this capacity, which could stall progress. To achieve the desired storage levels, a collaboration between private investments and regulatory frameworks is necessary to ensure that the right technologies are deployed efficiently.
Cost Management and Policy Considerations
As the UK prepares to meet the Clean Power 2030 targets, policymakers need to prioritize minimizing costs for consumers while facilitating the transition to a net-zero energy system. Options such as regional pricing systems could create incentives for energy consumers to locate near renewable generation sources, reducing the need for expensive transmission infrastructure. Ultimately, achieving the vision outlined in the Clean Power 2030 report will demand careful planning to balance the costs associated with infrastructure investments and sustainable energy production. Future government actions will play a pivotal role in shaping these strategies, emphasizing the importance of transparency and consumer engagement throughout the transition process.
A ‘Herculean effort’ in renewable buildout is the description used in NESO’s Clean Power 2030 report, outlining practical advice for the government on achieving a power system by 2030. The report defines what ‘Clean Energy’ means (>95% clean power generation by 2030) and discusses what buildout would need to look like in order to reach these targets. A staggering 70GW of new renewable generation is predicted to be needed to reach the targets in the ambitious Further Flex and Renewables scenario. How might these suggestions be achieved in practice, and what challenges is the industry likely to face over the next 5 years in the lead-up to target dates?
In this episode Modo Market Analyst, Joe Bush joins Ed Porter to explore NESO’s Clean Power 2030 report. Over the course of the conversation, they discuss:
The purpose of the Clean Power 2030 report and what it covers.
The sheer scale of buildout required to meet renewable and flexibility system targets, from 50 GW to 130 GW.
Transmission and network challenges and how the government might tackle the issue of constraint.
The role of energy storage in managing constraints and supporting the grid.
Exploration of potential market changes, including zonal pricing to incentivize demand location near generation.
Modo Energy provides forecasts, benchmarking, data, and insights for new energy assets - all in one place. Built for analysts, Modo helps the owners, operators, builders, and financiers of battery energy storage solutions understand the market - and make the most out of their assets.
All of our podcasts are available to watch or listen to on the Modo Energy site. To keep up with all of our latest updates, research, analysis, videos, podcasts, data visualizations, live events, and more, follow us on Linkedin or Twitter. Check out The Energy Academy, our video series of bite-sized chunks explaining how different battery energy storage systems work. For more information on how batteries can save carbon, check out our written research.
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