Centrally driven or the evolution of distinct energy strategies?

Since first publishing the report in 2015 we have seen many developments that will have a significant impact on how the UK meets its 2050 climate targets. The government has provided a renewed focus for clean growth, while developing a number of sector deals to add detail on how it intends to deliver this aspiration. That said, the core parameters of the low carbon transition facing the UK have not changed. The UK energy environment remains a complex web of needs, technologies and choices.

In our 2015 scenarios publication, we emphasised that it was not possible to advocate for a single energy system blueprint out to 2050. Instead we recommended the UK focused on developing a basket of options from among the most promising supply and demand technologies, a key message that remains true today. The 2018 update – using the ETI’s Energy System Modelling Environment (ESME) – a national whole energy system planning capability - hasn’t radically revised or built new scenarios but revised the assumptions we made since the report’s original publication, calling upon a decade of ETI work into low carbon technology development.

In Clockwork, coordination by central government means long-term investment in strategic energy infrastructure. The power sector sees retirement of all coal plant in the early 2020s and reliance on unabated gas is reduced through the 2030s, ensuring emissions reduction can be achieved through the electrification of heat and transport. The first carbon capture and storage (CCS) projects come online by 2025 with commercial deployment thereafter, focusing on large-scale hydrogen production but also deployed directly in power and industry. Some regions of the gas distribution network undergo full conversion to carry hydrogen to buildings for heating and cooking. Negative emissions from bioenergy with CCS allow the 2050 target to be met as part of a cost-effective pathway, even though unabated fossil fuel use persists in hard-to-treat sectors.

In Patchwork, with central government providing less strategic coordination, a mix of distinct energy strategies develops at a regional/sectoral level. A new nuclear programme fails to materialise beyond an initial two facilities and deployment of CCS infrastructure is held back, with the first demonstration projects delayed until 2030. Subsequent growth is constrained by lack of a coherent national plan. Lack of coordination also results in slower growth of a domestic bioenergy sector and more limited investment in port facilities for imported biomass resources. Taken together, constrained bioenergy and CCS programmes limit the potential for negative emissions, meaning more comprehensive reduction of gross emissions is required across the energy system to meet legally binding targets.

One of the key messages conveyed through the 2015 scenarios was the critical role of CCS as part of an affordable transition towards our 2050 goals, with both scenarios featuring CCS to varying degrees. In Clockwork, a stronger role for CCS was based on early implementation (from 2020) rapidly gaining momentum as part of a commercially strategic plan. CCS risks and uncertainties were reflected in Patchwork, with commercial deployment beginning later, from 2025.

At the time, it was considered that early implementation might have occurred through the government’s £1bn CCS competition to deliver commercial-scale projects by 2020, but support for this was withdrawn. The Government has since established the CCS Cost Reduction Task Force, while the Committee on Climate Change (CCC) has also reemphasised the importance of CCS, advising that the UK should not plan on meeting 2050 targets without it. The updated Clockwork scenario reflects this renewed focus on the strategic value of CCS, with commercial deployment from 2025. The updated Patchwork scenario reflects continued challenges in identifying a route to CCS commercialisation, with the earliest deployment coming five years later and rolling out less rapidly.

Clockwork and Patchwork are not forecasts, but rather two plausible scenarios. Our analysis shows that there are many pathways to a low carbon UK energy system within a wide range of variation. We find from these scenarios that featuring a balanced, multi-vector approach it is possible to achieve long-term emissions targets while keeping costs to around 1% of GDP in 2050. If key technologies are taken off the table, these costs will inevitably rise, potentially jeopardising UK industrial competitiveness and limiting lifestyle choices.