iet2008_loughead

7/31/2019 IET2008_loughead

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UK Energy Policy

John LoughheadExecutive Director, UK Energy Research Centre

President, Institution of Engineering & Technology

28 March 2008, Kuala Lumpur


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Source: DTI


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Coal

Petrol

Gas

Nuclear

HydroelectricityImports

Renewables and waste

2 0 0 5

Total: 234.3 mtoe

17.17.8

3339.9

1.7

%

1 9 9 5

Total: 218.4 mtoe

34.5

22.4

31.7

9.7

0.8

%


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Supply

Consumption


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Industry Sector

26%

Transport Sector

28%

Other Sectors

37%

Non-energy use

9%

Energy consumption by sector (IEA 2007) - *Other sectorscomprises agriculture, commercial & public service, residential andnon-specified. Non-energy use includes petrochemical industry.


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Source: IPCC


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Published July 2006

2 main targets: To tackle climate change

by reducing carbondioxide emission

To deliver secure, cleanenergy at affordableprices


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Energy efficiency> Houses> new Information Pack with energy efficiency

information

Industry> Climate Change Levy & EU Trade Scheme Transport>Fiscal and policy measures, Company Car Tax and

Vehicle Excise Duty & Voluntary Agreement on new vehiclefuel efficiency

Cleaner Energy: Distributed Energy Generation>Environmental Transformation

Fund

Combined Heat and Microgeneration

Improve market framework for investment in electricity

generations> Renewable Obligations Certificate

Replacing nuclear power stations

Cleaning up fossil fuels> CCS

Developing alternative fuels for transports


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Market information and projections>

improved analysis for gas and electricitysupplies

Securing electricity and gas suppliers

Maximising exploitation of UK oil and gasreserves

Limiting UK gas dependence

Managing gas import risks

Delivering competitive prices througheffective markets


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Examines evidence onthe economic impacts

Explores the economics ofstabilising GHGs in the

atmosphere Considers policy

challenges of transition tolow carbon economy and

also adaptation toconsequences of climatechange

It is an internationalperspective


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if we dont act, the overall

costs and risks of climate

change will be equivalent tolosing at least 5% of global

GDP each year, now and

forever.

the costs of action reducing

greenhouse gas emissions to

avoid the worst impacts of

climate change can be limitedto around 1% of global GDP

each year.


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UK Government

BERR

Ofgem Sets primary formulae

Customers

Network

Electricitycompanies&gassuppliers

Distributioncompanies

Liberalised since 1990

Full opening of market

2000


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UK GovernmentBroad Policy+ Renewables

- EmissionsTrading schemes

ROCsBERR

Ofgem

Oversee delivery

GeneratorsMajor

Customers

Smaller

Customers

Large CombustionPlant Directive

ETS

ROCs

Security of supply

Tradingsettlement

ETS Price signals

Promoting competition

Regulating monopolycompanies

Grid

Operators


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Renewables+ EU targets:

- 15% of energycoming fromrenewables by 2020

UK GovernmentBroad Policy+ Renewables

- EmissionsTrading schemes

ROCsBERR

Ofgem

Oversee delivery

GeneratorsMajor

Customers

Smaller

Customers

Large CombustionPlant Directive

ETS

ROCs

Security of supply

Tradingsettlement

ETS Price signals

Promoting competition

Regulating monopolycompanies

Grid

Operators


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The climate change levy (CCL) is a tax on the use ofenergy in industry, commerce and the public sector thataims to of the levy is to encourage users to improve

energy efficiency and reduce emissions of greenhousegases.

The CCL is intended to reduce UK carbon dioxideemissions by at least 5 million tonnes by 2010 byencouraging alternative energy technologies and energyefficiency.

The CCL adds approximately 15% to typical energy bills

of UK businesses. From 2006 the CCL increases annually with inflation


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Came into force in April 2002 as part of theUtilities Act (2000).

Requires power suppliers to derive fromrenewables a specified proportion of the

electricity they supply to their customers.

3% in 2003, rising gradually to 10.4% by 2010,and 15.4% by 2015. The cost to consumers will

be limited by a price cap and the Obligation isguaranteed in law until 2027.


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Fu e l Du t y : the planned fuel duty increase of 2 penceper litre in October 2008. Current fuel cost is 1.04 perlitre. Approximately 60% is tax.

Vehic le Ex c ise Du t y : From 2009 there is a rebanding ofVED. The outcome is that: cars 160 gCO2/km will incur an

additional one off cost in the first year. For example cars with 255gCO2/km will pay a one off cost of 950 cost of car and 430annual VED.

RTFO: 10% by 2020 Pub l i c t r anspo r t i nvest m en t : 5 bn per year


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Setting targets in

statute and carbonbudgeting

Establishing a

Committee on ClimateChange

Creating enabling

powers Reporting

requirements


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Directive issued February 2008 Targets for 2020:

Reduce energy usage by 20%

20% total energy from renewablesources

Legal requirement on all EU Member

States to meet local target UK target for renewable energy: 15%


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Renewable

34%Renewable

18%

Renewable

12%

Fossil and

nuclear

66%Fossil and

nuclear88%

Fossil

82%

Transport Heat Power


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Doing the sums

4.6% of UK electricity

generated from renewables,1.07% from wind

To close the gap betweencurrent 4.6% and EU target

of 20% with wind would needan extra 28,150 MW

In fact an extra 29.4% wouldbe needed, on the evidence

of the previous slide, whichwould nearly double theextra capacity required

Current global installed wind

capacity: 73,904 MW[World Wind Energy Assoc, 2006]

Total UK wind powercapacity installed:

1954 MW

Total wind generation:

4225 GWh

[BERR, 2006]
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Source: BBC news


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Fig 2

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Fig 2Fig 2Fig 2

Source: Council for Science andTechnology, 2005

BERR E ( d d i b di ) D f DfT ERP


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Research

Councils

Demonstratio DeploymenResearch &Development

DTI Technology

Programme,ITI Energy

ResearchCouncils

Carbon Trust

Demonstration DeploymentResearch &Development

DeploymentResearch &Development

EU emission trading schemeRenewable obligations (RO)

DA RDACarbon Trust

Policy support

DA- ITI EnergyCarbon Trust

Government capital grantsETF

RDA - DAEU Joint Technology Initiatives

Carbon Trust

TRL 1-3 TRL 3-6 TRL 6-7 TRL 8-9

ETI

EU Frameworkprogramme

BERR Energy (and advisory bodies), Defra, DfT, ERP, .

TSB


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Research Council Energy Programme

SUPERGEN Con so r t ia

Hydrogen

Marine

Photovoltaic

Carbon Capture and Storage

Som e H igh l i gh t s:


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Generation processes> biological

generation of sustainable hydrogenfrom renewable resources

Storage> advance the state-of-the-

art in safe and cost-effective

hydrogen storage materials

Social economic implications> howacceptable and feasible hydrogen isas an energy carrier


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Main research themes

Light trapping.

Extending the absorbing power ofsilicon.

Reducing the losses in solar cells.

Making materials efficient devicestructures

Improving process technology

Large area thin film PV array at St

Asaph, North Wales. EPSRC website.

Aim> reduce costs of solar cells

Materials 2nd and 3rd Generation: silicon, cadmium telluride andcopper indium di-selenide


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Assessment of the impact of future energy supply/demand scenarios.

Explore the role of CCS in the UK's energy infrastructure.

Investigation of CCS synergies.

Assit in extending the life of the UK North Sea oil industry by 1 or 2decades.

Investigation of the potential impacts of CO2 leakag.

Geographical Information System (GIS) based decision support tool.

Aim to deliver viable large-scale Carbon Capture & Storage optionsfor the UK.

CCS objectives


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Peterhead Power Station,Scotland

Source: BP


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Aim to deliver energy technology research to underpineventual deployment

Funding level> 550 million from Government over the next 10 years

Same amount provided by industry

Focus on development and demonstration

Technology readiness level 3 to 6

Will commission individual projects from partners and thirdparties.


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ETI Fi r s t p r io r i t i es:

Of f sh o re w in d

Reduce costs of energy to theprevailing least-cost.

Increased yields to 97%-98%.

Reduce risks.

Mar ine , Wav e and Tida l

Increase deployment to 2GW.

Reduce electricity costs tocompetitive levels by 2020.

Increase unit availability to 90%.


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Mission: support R&D fortechnology-intensive companies.

Cost shared support.

Mechanism: Collaborative Researchand Development, KnowledgeTransfer.

Energy supports: New materials.

Low carbon Technologies.

Advance light sources.

Tech n o logy St r a t egy Board


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Supports demonstration and

deployment

300 million funding

International and domesticelement

2 examples

Hydrogen Fuel Cells & Carbon AbatementProgramme

Ceres Power> Micro Combined HeatPower


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t


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The UK Government is committed to Low CarbonEnergy

Support for sustainable energy research trebledin 3 years

World lead in marine energy

Strong position in

fuel cells & hydrogen Off shore wind

CCS

Strong underlying university base


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www.ukerc.ac.uk

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