GVA’s latest research entitled “Keeping the lights on” isn’t sensationalist. Instead it reveals how future energy capacity will come under increasing pressure, and present the very real possibility of government-orchestrated nation-wide blackouts by 2015. This could be combined with steep rises in energy costs.
EU emissions legislation means that the majority of coal power stations will be closed by 2015, whilst the nuclear network is either in the process of being decommissioned or has just a decade of operational life left. At the same time, the Government is attempting to meet its Kyoto protocol commitments.
The research reveals how an important contributor to the solution, amongst others, is the process of microgeneration. Whilst this concept has been successfully utilised within the residential sector, the commercial sector has yet to embrace the process of small scale heat or power generation by individuals or occupiers as an alternative or supplement to the main energy network.
The benefits of microgeneration are threefold. Firstly the property owner or occupier receives an income from the Feed in Tariff or Renewable Heat Incentive for energy produced. Secondly, if any additional energy can be exported back into the grid, a further 4.64p per KWh is received. Finally, there are savings by not having to pay for electricity or heating the property.
GVA is also calling on government to ensure that new forms of infrastructure are being planned and delivered to ensure security of supply – such as new nuclear power plants, and greater investment in the renewables sector.
Steve Brown, Senior Director and Head of Energy at GVA, comments: “Having been largely ignored for the past 20 years, the energy sector in the UK is about to enter a period of rapid transformation. For households, businesses and the property market in particular, energy security and the associated cost will become an increasingly important issue. The targets our government, as well as the EU have set, are challenging to say the least. The way forward is to accept that the future of energy supply must incorporate a broad mix of cleaner coal, gas and new nuclear with a mandate to wherever possible promote all forms of renewable energy. Whatever the mix is to be, the government needs to take decisive action. We believe microgeneration, amongst other ingredients, can play an important role in helping to plug that energy shortfall through marginal gain.”
The government has maintained its commitment to the UK Climate Change Act 2008, with the stated aim of reducing carbon emissions, between 1990 and 2050 by 80%. This is coupled with the aim of producing 15% of total energy output from renewable sources in 2020 under the Renewables Directive. However, in 2011, renewables accounted for just 9% of total energy production.
Steve Brown continues: “The big question is whether the existing support from government is anywhere near sufficient for the UK to meet its obligations. We’d estimate that if microgeneration were to be utilised to the level it’s already been used in the residential market, it would have the potential to meet 3% of the total renewable sources output in the UK. With an energy shortfall likely to kick-in in as little as 18 months if existing supplies do not increase at the rate they need to, then surely this must become a more serious consideration within the commercial property market.”