England

Current Situation
The potential for renewable energy in the UK is reasonable. It enjoys the highest annual mean wind speeds in the EU especially in the North and in coastal regions. It also has good potential for offshore wind and tidal energy with some potential for biomass and solar. However, the current penetration level in the UK for renewable energy is currently relatively low. In 2006 only around 1.5% of the UK final energy consumption came from renewable sources, with a total installed capacity of 7,745 MW (operational), according to a RESTATS report. Importantly however this level is set to increase as a further 8,527 MW is under construction or waiting to be built.

Currently, the main contributors to renewable electricity generation in the UK are wind (39% with 33% from onshore and 6% offshore technologies) hydro (30%) and biomass (30%).

On-shore wind represents the most significant operational, installed generating capacity, with a total of 2,114 MW, 55% of the total renewable energy generating capacity in the UK. In 2006, there was about 5 GW of renewable generating capacity in the UK, supplying about 4.5% of the total electricity demand.

One of the main barriers to deployment of renewable technologies is the existing electricity grid infrastructure. Appropriate incentives are needed to facilitate access to the grid and to make grid connection an economically attractive option. Furthermore, the UKs electricity grid is in great need of upgrading, especially as it is envisaged that a large number of micro-renewable systems are to be connected in the near future (in line with the Government’s target of zero carbon homes by 2016).

The existing planning system has become another main barrier for deploying renewable systems, with planning applications encountering long assessment periods and resistance from the general public.

Perspectives
UK’s contribution to the EU target of achieving 20% of renewable by 2020 can only be achieved by increasing the current share of renewables in the energy mix to about 15% by 2020.

To meet this target, there is a need to increase investment in renewables technologies and reduce UK gas imports by 11-14% in 2020. Preliminary analysis suggests that the key growth areas in the UK will be wind (on and offshore) and biomass, whereas the increase of other renewable technologies will be less significant. However, all technologies should be invested in and have their potential fulfilled. As the new US President acknowledged in his inaugural speech when addressing climate change: the resources are available but ‘no single technology or set of regulations will get the job done’.

The growth of renewable technologies in the UK is closely linked to the trends of the international market, i.e. global perspectives. The global uptake of important technologies such as wind turbine and solar PVs has increased significantly in recent years mainly due to economic initiatives from countries such as Germany and France. This has been linked to significant developments in the technologies themselves. For example wind turbine now have an ‘availability’ of 97% (i.e. the reliability has increased) and their efficiencies are now reasonably close to the theoretical maximum (Betz limit). PV costs (with the advent of thin film technologies) have decreased significantly (as much as 10% each year) and efficiencies are being improved continuously (with still significant potential for the future). Renewable energy providers predict that PV and solar energy will be one of the most important sources of energy within as little as 10 years.

Other big players on the international market such as the US have had limiting policies to the deployment of renewable. Nevertheless the new US President has addressed the issue of climate change with a commitment to the creation of half a million new jobs related to renewable and clean energy as well as doubling alternative energy generation capacity. Other measures include the provision of new transmission lines to distribute renewable energy across the country. In addition, the newly appointed US Chief Climate Negotiator advocates for a transformation of the global economy, from a high carbon to a low carbon energy base, to become the driver of economic growth for this century.

Increasing the share of renewable sources in the UK energy mix can only be accomplished with Government’s long term support through legislation and financial incentives to encourage private investment. Other objectives, according to the consultation document, include promoting the development of new renewable technologies where the UK can become a market leader, providing support for specific technologies and addressing skill shortages.

Approximately half of our share of the EU 2020 renewable energy target may need to be met in the electricity sector. On that basis, perhaps a third or more of UK electricity would come from renewable sources by 2020 – compared to less than 5% today. This would give 35 to 40 GW of renewable generating capacity, compared to 5 GW today. The majority of this can be expected to come from onshore and offshore wind, with important contributions from biomass, hydro and potentially major tidal range projects in the Severn Estuary and elsewhere.

The biomass target is to bring to the market 2 Mton every year by 2020, according to the England Woodfuel Strategy report, representing a 60% increase of wood production compared to current levels (for England only). To achieve this target the sector will primarily use under-managed woodlands. The success of the strategy is centred on strengthening the existing supply chain for wood already cut which currently cannot meet the target. The greatest contribution from biomass is expected to be through local heat generation (small scale) and supplemented by CHP around towns and cities. In addition, new energy crops are expected to play a significant role in co-firing energy plants.

The cost of energy from off-shore wind could decrease significantly according to a Carbon Trust report. This will help enable the 29 MW of off-shore wind capacity required to achieve the 2020EU renewable targets to be realised - with an estimated investment from industry of up to £75bn. The cost of energy from offshore wind could decrease by 10% at least as a result of a major new technology development initiative - the Offshore Wind Accelerator (OWA). This initiative comprises a set of major research, development and demonstration activities and will focus on cost and risk reduction in the short to medium term, covering key topics related to wind farm design, construction and operation. The first phase will comprise feasibility studies, with large scale demonstration projects planned for phase 2, from 2010 onwards.

Key Players
The government play a key role in the UK development of renewable energy sectors. It has committed to the largest long terms carbon emission reduction seen in Europe – 80% by 2050, although it has come under criticism for not doing enough to achieve their proposed targets. The government has opted to implement the Renewable Obligation Certificates (ROCs) and initial capital cost grants, instead of the more common fixed feed-in tariff approach, to ensuring more renewable electricity is generated. This compensate for the typical low feed-in rates offered by most (but not all) utility companies. This scheme has meant that since April 2002, UK energy providers have been obligated to provide (until 2027) a certain percentage of their energy from renewable sources. The energy companies can achieve these targets by generating their own renewable energy or by paying others to do this for them. This does not mean companies are ‘buying the electricity’ – just the fulfilment of an obligation. Thus energy companies can buy ROCs from any renewable electricity generator in the UK whether the energy is consumed on-site or sold to the grid. The value of theses certificates varies and NFPA (Non-Fossil Purchasing Agency) & E-roc auctions have been selling each certificate for over £40 per MWh.

Local authorities and planning offices are also key players. Currently the planning system is struggling to cope, for instance, with the volume of interest in microgeneration as it is under resourced. Planning is a significant obstacle to the move towards development of distributed renewable energy networks. It can be both costly and time consuming. Currently, the majority of planning officers lack technical understanding and there is little detailed guidance available. The development of General Permitted Development Orders, where agreed technology can be installed without planning permission, would be a significant step forward for microgeneration.

Developers and investors are also key players. However, they can be seen as somewhat secondary as investments would readily be present if enough incentives are provided. This has been seen in the wind industry with many investors stepping forward to install wind farms. In the UK, the wind energy actors are key players in terms of the number of renewable energy jobs in the UK. At a European level, a recent European wind energy association (EWEA) report shows that jobs in the wind energy sector are expected to double by 2020, reaching a figure of about 325,000. Within this sector, the turbine manufacturers are expected to be the main employers. In the UK, however, there is no presence of large scale turbine manufactures. However, interestingly, the UK is leading the way in small wind turbine manufacturing. Recent figures from the British wind energy association (BWEA) suggest that UK small wind turbine manufacturing employs around 1000 people (2007) exporting 40% of their products (to over 100 countries). In 2007 there were around 7000 units erected with an installed capacity of around 7MW. In 2020 this is expected to increase to 600,000+ installed UK units corresponding to 1.3 GW (1.7 TWh per annum). This would provide a £ 750+ million market and 5,800 UK based jobs. In 2040 this is expected to reach 4,000,000 UK units which correspond to an installed capacity of 8.75 GW (11.1 TWh per annum which is 3% UK Electricity). This would provide 10,000+ UK based jobs.

Electricity generation and distribution is managed by private companies. These companies are key players. The current electricity providers include: Amerada, Atlantic Electric and Gas, Basic Power, British Gas, Cambridge Gas and Electricity, Countrywide Energy, Ecotricity, EDF Energy, E.ON Energy, Equipower (EBICo), Good Energy, Green Energy UK, London Energy, Lloyds TSB, Manweb, npower, Sainsburys Energy, Scottish Hydro-Electric, ScottishPower, Seeboard Energy, Southern Electric, Swalec, SWEB Energy, Utility Warehouse, Utilita, Virgin Energy, ZEST4. The incentives these private companies offer for green electricity producers will player a key part (in the absence of a UK fixed reed-in rate) and some companies, like Ecotricity, have already made the move to significant investment in green technologies.

Job demand
According to a Government report on Renewable Supply Chain Gap Analysis, approximately 8,000 jobs are currently sustained, directly or indirectly, by the RES industry. Considering the current portfolio of MW in operation, under construction or under development, this translates to an average of 10 jobs per MW.

Importantly, a number of skill shortages were identified in the UK renewable energy industry, including:
Professional project development skills associated with the exploitation of business opportunities (e.g. financial management, business planning, project management legal skills, marketing and sales & services).
Technical skills associated with the manufacture, construction and installation of renewable energy projects (e.g. electrical, mechanical, civil, combustion, process, electronics, software and environmental engineering).
Specialist technical skills in engineering, environmental and planning at a professional level associated with consultancy services, project development and R&D activities.
Specialist knowledge of complex form manufacturing, such as gear profile manipulations, modelling and design.
Heavy engineering and specialist skills in marine offshore technology associated with the design, development and installation of offshore wind, wave and tidal projects.
Skills necessary to develop and maintain a fuel supply system for energy crops.
Power system design and engineering which includes specialist software and hardware.
Control skills to allow for monitoring more complex networks that result from increased renewable projects.

Some other skills were identified as ‘transferable’ from more mature technologies, including:
Skills relating to the marine offshore technologies including project management procedures and construction facilities, underwater intervention technique skills and experience. These have been developed for the North Sea oil and gas industry and may be transferred to the offshore renewables industry
The PV industry is characterised by its interface with the established construction industry, which is served by the required trades. The obstacles faced by the PV industry is accessing skilled personnel (electricians, roofers and facade installers) could be transferred from the construction industry rather than needing the evolution of a new specific skilled trade.

Companies involved in the renewable energy industry have identified a shortage of graduate engineers and trained craft workers in the market. The current low appeal of the engineering profession in the UK has been suggested as a potential cause as well as the insufficient sponsorship, a necessary instrument to attract undergraduates. Recruitment proved also difficult in specialist areas such as electronics and control instrumentation, design and manufacture of composites, geophysics, specialist fabrication, combustion engineering, energy crop experience and project installation and commissioning.

However the most common shortage appears to be General Management and Project Management, possibly due to the large number of projects currently under development and the relatively immaturity of the industry. These skills could be easily transferred from the thermal power sector. The same report states that between £15 and £19 billion will be needed by 2020 to meet the renewable energy target, depending on the renewable energy mix scenario considered. In terms of employment, this would mean between 17,000 and 35,000 jobs could be sustained by the renewable energy industry.

England

Keywords in the same group

RES COMPASS project partners