Skip to content

Can the UK decarbonise power by 2035?

October 11, 2021

By Paul Homewood

 

Timera present a stark, if rather naive, analysis of Britain’s energy future:

 

 

image

Can the UK decarbonise power by 2035?

‘UK commits to decarbonise electricity system by 2035’ – UK government (BEIS) Oct 7th 2021

There are plenty of details required to understand what this statement really means, but it can only be interpreted as a big acceleration in the UK’s decarbonisation timeline.  This new goal reflects the simple reality that the 2050 net zero target depends on decarbonisation of the electricity system in the 2030s.

There is undoubtedly politics in play ahead of the UK hosting the COP26 climate summit in Glasgow later this month.  There is definitely some ‘wriggle room’ for Boris on the interpretation of ‘decarbonisation’. But we should know more across the next 3 weeks, with the government promising further details ahead of the COP26 summit.

However there is enough in the announcements to date to for us to start getting to grips with what the target may mean for markets and asset values. In today’s article we take a look at the impact of closing all fossil capacity by 2035 and 5 key implications for the UK power market if this is to happen.

Can renewables keep pace with gas closures?

Simple answer: No. However that doesn’t mean that decarbonisation by 2035 is impossible, it just implies a requirement for enormous investment in new flexible capacity.

A way to objectively assess the renewable vs thermal closure capacity deficit is shown in Chart 1.

Chart 1: Derated wind & solar build vs thermal retirements to 2035

Rather than layering on subjective or scenario based assumptions, Chart 1 shows the following simple comparison:

  • Derated wind & solar capacity volume additions required to meet the government’s current 2030 RES target (with extension to 2035 based on similar growth rate trajectory)
  • Derated capacity reductions from the closure of all coal by 2025, all CCGTs by 2035 and nuclear plants based on regulatory scheduled closure dates.

The chart does not capture (i) any new build capacity, which acts to reduce the deficit or (ii) any increases in peak demand as other sectors electrify (e.g. EVs, heat industry), which acts to increase the deficit.

So to be clear it is not a scenario or a prediction of future capacity shortfall.  It is a mechanical calculation that highlights the scale of the difference between derated renewable build and thermal asset closures. In numbers that deficit rises to around 25GW by 2035.

Let’s now consider a summary of 5 implications of the 2035 target and implied RES vs thermal deficit.

1.Large increase in renewables build

The 2035 target clearly requires a substantial acceleration in renewables build on top of what are already challenging 2030 targets

  • The heavy lifting is likely to be done by offshore wind & solar, with rapid scaling of support for offshore wind farms & transmission infrastructure key
  • Additional incentives may be required for solar, including targeting colocation with storage
  • There is major transmission network investment required to address constraints, particularly in Scotland & East Anglia (where offshore wind networks come onshore)
  • Storage & electrolysers may play an important role in managing constraints
  • The government is likely to attempt to back BECCS (biomass with CCS) technology, but may face an uphill battle given its controversial climate credentials.

2.Huge storage investment required

Given 1., storage represents a key fast response source of balancing & load shifting, albeit a net consumer of energy

  • Accelerated deployment of batteries will be required to cover shorter duration requirements (e.g. 1 – 8 hour)
  • The Climate Change Committee are projecting 18GW of battery capacity by 2035 but this may need to be higher
  • Longer duration technologies (e.g. 8 hrs plus) are a big gap that will likely require additional policy support to resolve
  • Limitations with pump storage hydro sites are likely to see evolving storage technologies come into play (e.g. Compressed Air, flow batteries & the new iron-air battery technology)
  • The other avenue for access to storage flex is via interconnectors e.g. expanding the links to hydro rich Norway, but current cap & floor policy support may be inadequate given structurally converging cross border prices.

3.Target implies Gas + CCUS in scale

Carbon capture & storage is still a nascent technology but the UK is leading European CCUS deployment

  • Scaling of gas with CCUS strongly depends on efficient delivery of the UK’s CCUS clusters to provide cost effective transport & storage support infrastructure to enable CCUS power plant investment
  • Closing (or repowering) unabated CCGT plants by 2035, will likely require at least 5 – 10 GW of new CCGT + CCUS, potentially up to 20GW
  • Why? In a 2035 horizon there is simply no other scalable dispatchable generation technology to plug the energy & capacity gap left by retiring the UK’s almost 30GW of existing CCGTs
  • Heroic storage deployment volumes do not solve this issue given storage is a net consumer (vs generator) of energy; some form of dispatchable generation is required to fill prolonged periods of low wind & solar output (as experienced across Europe in H2 2021)
  • An important factor determining CCGT + CCUS volumes will be how much incremental nuclear capacity can be built beyond Hinkley C; the government may try another nuke (e.g. Sizewell or Wylfa) as well as trying to accelerate scaling of SMR technology.

4.Hydrogen required but not a silver bullet

  • The major impact of hydrogen is likely to be focused beyond 2035 given the huge challenges in scaling cost effective production, but it is definitely an important piece of the puzzle
    • Hydrogen will almost certainly remain an expensive fuel in 2035 which points to its power sector use being focused on peaking capacity
    • The lowest hanging fruit is likely to be the repowering or conversion of gas engines to run on hydrogen
    • The role of hydrogen as a generation fuel is also dependent on significant scaling of production by 2035
    • Current electrolyser targets are relatively small in hydrogen production volume terms and green hydrogen depends on access to low cost power (easier to source over time as renewables penetration increases)
    • Hydrogen’s contribution to the 2035 target therefore relies strongly on scaling of blue hydrogen via targeted support and development of the UK’s CCUS clusters.

5.Demand side engagement required

Maintaining stability in a decarbonised power system is going to be most challenging in periods of low or fluctuating wind & solar output; this is where demand side engagement is set to play a key role

  • The ability to dynamically flex aggregated load sources across these periods will be critical for system balancing and managing prolonged lulls in RES output
  • Most of the DSR volumes successful in the UK’s Capacity Market to date have been backed by engines & batteries behind the meter i.e. is not true DSR
  • A new policy framework & incentives are required to fully engage DSR, including changes to Grid’s calling of flex and the role of distribution network operators
  • New technologies are also likely to play a key role e.g. smart appliances / software, smart charging of EV batteries and eventually vehicle to grid flex
  • There are substantial distribution network investment requirements for dynamics demand engagement to become a reality.

The scale & pace of investment required to decarbonise the UK’s electricity system represents a second industrial revolution.

Talk is cheap for politicians, particularly when they will be long retired in 14 years time. But the UK government appears to be anchoring its economic recovery plan around decarbonisation and investment in the north. And this is likely to produce an unprecedented set of opportunities for energy investors.

https://timera-energy.com/can-the-uk-decarbonise-power-by-2035/


It is that graph which tells the real story:

We are looking at 30GW+ of retiring capacity, with less than 10 GW of derated renewable capacity added. To be fair, it does not include potential new nuclear capacity, though given the timescales involved we would be needing to set the wheels in motion now to get it up and running by 2035.

Just to recap Timera’s main points:

  • Most of the heavy lifting will fall on offshore wind, but this will still add little reliable capacity.
  • Timera’s derated wind wind capacity may be OK in average terms, but still looks overly optimistic during periods of low wind speeds.
  • Huge storage capacity will be needed, but this can only cover short term fluctuations, typically up to 8 hours.
  • Interconnectors will be needed, but their contribution will be limited
  • The target implies gas with carbon storage will be needed in bulk, which does not exist as a viable process, and would in any event make all of the extra wind capacity redundant.
  • Hydrogen, with all of its problems, is probably only useful for peaking.
  • Demand side response (DSR) will also be needed to address peaks in demand, but again this is not relevant for long term supply shortages.
  • Most of the current DSR is actually backed up by off grid generators, and is thus not true DSR.
  • These figures don’t allow for the extra demand, which will inevitable follow the electrification of heat and transport.

I called this analysis naive at the start, because Timera have glossed over the very real issue of how the grid can supply reliable, dispatchable power for the days and weeks on end when wind power is running at low levels.

For all of the talk of smart meters, batteries, hydrogen and interconnectors, this is the elephant in the room which refuses to go away.


It is worth recalling, by the way, the Labour manifest in 2020, which to all intents and purposes promised the same:

 

image

49 Comments
  1. October 11, 2021 1:11 pm

    Any deliberate and premeditated continued destruction of fossil fuel based generation such that there was no ‘backup plan’ would be reckless in the extreme, with direct impact on peoples’ livelihoods, and lives. Problem is, that’s exactly what the green zealots want. Question is, how to make them personally liable for their decisions, which they should have, and should be pressured on. They will no doubt deny any such liability, but need to be embarrassed by it.

    I forwarded the GWPF Net-Zero Watch announcement email to my MP (a climate-change believer) this morning, specifically stating that we don’t have an energy crisis but an energy POLICY crisis, of their own making despite years of warning, closing it with “we told you so”. I hope he’s embarrassed.

    • Harry Passfield permalink
      October 11, 2021 4:31 pm

      I like where you’re going with this. Any policy-maker, or academic who advises him/her should be made aware of the possible outcomes at odds with their schemes. And they should be made accountable. I mean, we’re not talking about doing away with the odd power station, we’re talking about a whole new concept of energy delivery – which is odds on not to work. Outcomes have consequences.

    • Julian Flood permalink
      October 11, 2021 5:14 pm

      Dream on. I told Matt Hancock in the mid twenty teens that he was playing Russian roulette with the Grid. He’s currently making a bid to woo his local Conservative Association which gives some idea of his hide.

      JF

  2. October 11, 2021 1:26 pm

    What is “derated capacity” ?

    • It doesn't add up... permalink
      October 11, 2021 2:22 pm

      It is the amount you might actually expect to be available. For conventional plant, it allows for time lost to maintenance shutdowns. For things like wind, it allows for the fact that the wind doesn’t blow consistently as well.

      • October 11, 2021 5:27 pm

        Yes, but it fails to deal with the fact that proper power stations don’t all switch off at the same time, whereas wind and solar both do.

      • Teddy Lee permalink
        October 11, 2021 8:36 pm

        Because it was a national grid ,all outages for maintenance were planned on a national basis.Nearly all maintenance programs were spread over the period of lowest demand.eg Summer
        Remember,it was not unusual for a 2000MW PS to run its Units ,24/7 for months and months on a continuous basis.
        A PS with four 500MW sets could cope with loss of one set .Worth remembering that we in the UK had a supply system in 60s and 70s that had .huge over capacity
        Grid failure at 275kv and 400kv was a rarity.j
        .

      • October 12, 2021 6:58 am

        No mention from the Greenies of the immense environmental destruction that will take place as a result of massively increased mining of rare metals. Or of the vast amounts of CO2 require to make a turbine, and the vast amounts of CO2 required to make cement and concrete.

        Comrades. The future is clear. To save the planet, we must destroy it.

  3. October 11, 2021 1:32 pm

    For a nation sitting on 400 year’s worth of coal and an even longer future ‘stock’ in Fracked gas, all this abundent silliness re CO2 is simply laughable. NOTHING we do can materially affect the climate or even local weather, to any extent. Whatever we DO do is ‘overwhelmed’ by the Chinese and others who will carry on as usual, consuming dirt cheap coal and gas whilst we struggle with our ludicrous, hideously expensive,nationally subsidised windfarms. On a really ideal windy day they DO produce some worthwhile power, but mostly they’re surplus to requirements. Some bunch of idiots claim that some FOODS have an over heavy carbon footprint(!) so should cost MORE to save the planet! Cambridge ‘academics’! That’s our meat and dairy products, imagine butter having a carbon footprint? What planet are these people on?

    • October 11, 2021 1:36 pm

      The media (British Bu****it Corp) have even started the narrative that China are moving to gas. Another thread to their denial.

      • October 11, 2021 9:16 pm

        I guess you meant “China are moving AWAY FROM gas”

      • October 11, 2021 9:20 pm

        The implication (bias?) of the article was China’s use of gas, whilst saying nothing about how coal still makes up the bulk.

      • It doesn't add up... permalink
        October 12, 2021 3:04 am

        I’ve found it astonishing to see how many different LNG terminals China now boasts. There are now at least 18 of them, and they have been busy.

    • October 11, 2021 6:06 pm

      Re: fracking. For some reason the mainstream media don’t seem to want to mention the fact that the “energy crisis” of high gas prices does not relate to the US, because it is self-sufficient in gas. It is obvious that the move to renewables is the cause of the trouble for the UK. But I have heard ministers and others claim that the best escape from “volatile gas prices” is to stop using gas, with no pushback, no challenge, just a meek acceptance.

      • October 11, 2021 6:10 pm

        Ministers’ claim for ‘more renewables’ to solve the gas crisis is a classic outworking of the definition of insanity.

      • It doesn't add up... permalink
        October 12, 2021 3:10 am

        The fact thhat Kwarteng blamed gas exclusively and ignored the much higher electricity prices signalling capacity shortage shows how poorly he understands and that his advisors are useless.

  4. Jack Broughton permalink
    October 11, 2021 1:34 pm

    Surely the answer is simple, build a few more “Draxes”, we can convert them back to coal once the evidence of negligible anthropogenic climate change becomes even more apparent to anyone who looks outside.

    Sadly, the UK has now lost the manufacturing base and design base needed to build this type of power station and they would be imported. A generation ago we were among the world-leaders in coal power systems and power stations, now all are imported.

  5. It doesn't add up... permalink
    October 11, 2021 2:25 pm

    Timera did a very similar piece on Germany which essentially questioned whether German ambition is consistent with keeping the lights on and hitting emissions targets.

    When I was reviewing some old links, I came across this from January 2016:

    https://www.imeche.org/news/news-article/closure-of-uk-coal-and-nuclear-plants-to-create-electricity-supply-gap-of-up-to-55-by-2025

    Government never seems to take notice of real projections.

    • October 11, 2021 4:59 pm

      Why are we still even talking about ’emissions targets’ when no evidence exists to say that our emissions affects the global climate one iota?

      Why are we (UK) still beating ourselves up about our emissions when China, India, etc. add more every year than we produce in total?

      The whole thing is lunacy on a mind-bogglingly grand scale. The Lunatics really are in control of the asylum.

  6. Harry Passfield permalink
    October 11, 2021 3:20 pm

    I love (not) the idea of an 18GW battery capacity. Given a hiatus on wind and the battery was used – and used up – they then have a not inconsiderable problem of charging the damn things up again. In any case, what price 18GW of batteries, and how long before they have to be replaced? And can you imagine trying to run some of the power-hungry continuous processes that are currently explaining what will happen if they have to stop them.

    • mjr permalink
      October 11, 2021 4:46 pm

      And who controls most of the rare earth supplies needed for all these batteries? China.. So no potential supply issues then!

    • October 11, 2021 5:48 pm

      GW is a measure of power, which says nothing about how long these batteries can supply said power.

      • Harry Passfield permalink
        October 11, 2021 6:41 pm

        Yes, I know. 🙂

  7. Ian A Watson permalink
    October 11, 2021 3:25 pm

    Is anyone thinking about the national security implications of depending on cross-channel interconnects? Imagine a time of hostility, where a foreign adversary destroys or disables the connectors. War in/with Europe has happened before.

    • October 11, 2021 5:51 pm

      France has already threatened to cut the juice. The Business Sec is about to make a decision on the Aquind connector: “no” would be an obvious choice given that your friends don’t threaten to cut you off if you don’t grant them a few fishing licenses.

      [The Aquind connector is controversial, and its promoters featured in the Pandora Papers.]

  8. Broadlands permalink
    October 11, 2021 4:06 pm

    Can renewables keep pace with gas closures?
    Simple answer: No. However that doesn’t mean that decarbonisation by 2035 is impossible, it just implies a requirement for enormous investment in new flexible capacity.

    It implies (and requires) that carbon fuels for transportation are kept available and at low cost. Renewables don’t transport anything and battery-powered vehicles are not ready for global use. Even their development and distribution requires carbon fuels. The world is already witnessing this problem in “flexible capacity”. It isn’t pretty.

    • Jordan permalink
      October 11, 2021 4:44 pm

      Totally agree with you Broadlands.
      The decarbonisation agenda needs a backup source, which is normally the assumption of the (fossil fuel) markets it claims to be replacing. These markets only exist because there is enough demand to maintain plentiful supply, therefore needing cash flow for investment and maintenance of extraction and transportation. Price discovery needs the market depth and liquidity of a routine trading activity between creditworthy counterparties.
      If the decarbonisation agenda is seeking to kill this off, it cannot then have the assumption that the same market is available to provide reserve. Something has to give. It could be reliability, which is just another way of saying reserve is not provided. Or it could be price, which means reserve is kept available at huge expensive and without the transparent pricing mechanism we enjoy today.
      Yes, today’s experience, which is routinely referred to as a crisis, is the market giving advanced notice of what is to come.

  9. markl permalink
    October 11, 2021 4:07 pm

    When virtue signaling bumps into reality the people suffer.

    • October 11, 2021 5:03 pm

      It already has, and we already are. The eco zealots are achieving what they set out to do, and our politicians are too dumb to realise it. If they only applied a little rational thought to the whole boondoggle, it would end tomorrow. Problem is, rational thought is an anathema to politics.

  10. JohnM permalink
    October 11, 2021 4:24 pm

    Remember that in 2035 EVERY wind generator that is running today will be at the end of its life (25 years) and producing 50%(?) of its present energy.

    Are there plans to replace them? Who pays?

    • October 11, 2021 4:25 pm

      Who pays? We do of course!

    • chriskshaw permalink
      October 11, 2021 5:35 pm

      Thank you for this thought. I will not be able to sleep tonight (seriously!). One of the scariest sentences I’ve read (although the prospect of re-charging an 18MW battery with excess power – wtf is excess power?? – was also pretty chilling. Does one purchase the battery already charged?)

      • October 11, 2021 5:53 pm

        As well as producing insufficient power a lot of the time, wind farms produce excess power some of the time – both problems that will increase in proportion to the penetration of wind into the system. [See my post “randomly blows the wind” on Cliscep.]

      • chriskshaw permalink
        October 11, 2021 6:05 pm

        Surely “excess” wind generation allows the base load to be ramped down rather than be suddenly allocated to a new use. If the grid is entirely intermittents we could theoretically have “excess” … more likely to have plant down for maintenance before topping up said battery, or hydrolysing water for H2, or whatever else the “excess” has been promised to.

      • October 11, 2021 6:10 pm

        Chris, at present the response would be from gas, but when we reach utopia we won’t have any gas (maybe, speculatively, CCUS). At present the wind can be curtailed when in excess, at which point they send the bill for subsidies foregone.

  11. Dave Andrews permalink
    October 11, 2021 5:39 pm

    What about the railways?

    Currently only about 38% is electrified. Network Rail say some 13,000 kms will need electrification whilst 1300kms could be used by 350 hydrogen trains (equal to just 8.6% of current diesel stock) and 800kms for battery trains.

    Government approval of this large scale electrification programme is far from certain and would in any case take decades to deliver.

  12. October 11, 2021 5:55 pm

    Labour: “We will build enough solar panels to cover 22,000 football pitches.” What have they got against folk who play or watch football? 🙂

  13. Gamecock permalink
    October 11, 2021 7:02 pm

    “In order to reduce carbon emissions, the light at the end of the tunnel has been turned off.” – GC

  14. Nicholas Lewis permalink
    October 11, 2021 8:36 pm

    Surely all just playing the game for COP26 so BoJo can look like the man who saved the world from so called climate change.

    Just look at tonight hardly biggest winter demand yet but gas is supplying 53% and wind 13%. So to extract the gas generation from wind even on a good day would need them to build out another 40GW at least and that still wouldn’t cover a blocking high over Northern Europe. And they also forget every West European country is embarking on this same lunacy as well as electrifying its road transport so bring a further squeeze and cost pressure on battery manufacturing as well as increased electrical demand.

    But as I say this is just show and one thing you can be sure with BoJo they will change their minds.

  15. October 11, 2021 9:10 pm

    Who ? “Timera Energy”
    Founded in 2008, First registered at Endwell Road Brockley London
    Directors #2 David Stokes (who came from Australia worked in energy and financial markets since 1996)
    #1 Oliver Spinks (founder who used the Maori word for chimney to title his corp)
    expat Kiwi Olly Spinks, lives in London
    For one year was Head of Trading Analytics at BP
    https://uk.linkedin.com/in/olly-spinks-5b41b0a
    ,,, radio interview https://www.rnz.co.nz/national/programmes/sunday/audio/2018682848/calling-home-olly-spinks-in-london
    “cost reductions in renewables are changing the world” really ?
    “wind and solar are even cheap than gas/coal”

  16. EppingBlogger permalink
    October 11, 2021 10:46 pm

    The paper suggests new policies to solve technical problems. That is not the way life works.

    It also talks glibly about demand management. What that really means is power cuts. Some users will not be able to access electricity when they need it because there is not sufficient available.

    The paper published today by GWPF is rather more practical than this apology.

  17. Peter permalink
    October 12, 2021 3:56 am

    “Can the UK decarbonise power by 2035?”

    A nice example of Betteridge’s law of headlines. 🙂

  18. Adamson permalink
    October 12, 2021 8:25 am

    Of course we can have carbon free electricity by 2030 it will be easy.
    The only problem will be that we will have to get used to a lot less electricity for many people this will mean none at all. Even the rich will have to accept frequent power cuts and of course all remaining industries will have to close.
    But Carrie will be happy

    • 3x2 permalink
      October 12, 2021 5:59 pm

      But Carrie will be happy

      Not sure how much of this mess is down to her. It’s been decades in the making.

      • Adamsson permalink
        October 13, 2021 7:17 am

        I nearly said but you will be happy in a reference to the WEF 2030 plan for compulsory happiness. 🙂

  19. James Broadhurst permalink
    October 12, 2021 3:25 pm

    Did anyone listen to the Gummer interview on R4 at 1 on Monday wherein he claimed that the UK, being the originator of the industrial revolution, is responsible for climate change?

    The man is a lunatic.

    • 3x2 permalink
      October 12, 2021 6:04 pm

      being the originator of the industrial revolution, is responsible for climate change

      Presumably the RoW will be only too happy to head on back to subsistence farming then?

  20. October 12, 2021 6:21 pm

    No because all of the interested parties are making it up as they go along! They are all winging it. That alone should tell anyone with more than three active brain cells that this is all a great big lie that they have all bought into and they are all to far in to admit it.

    • James Broadhurst permalink
      October 12, 2021 10:35 pm

      The BBC’s David Shukman in the 2200 news offered that due to water levels rising more houses on Norfolk’s coast would be lost and offered as evidence a clip of houses being destroyed by the sea. Now, Shukman clearly has no idea about long shore drift which has been sweeping away the coast line of Norfolk for hundreds of years. It’s a disgrace that somebody in his position is so thick.

Comments are closed.

%d bloggers like this: