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The UK Government’s Energy White Paper and what it means for our net-zero efforts moving forward

Wednesday 23 December 2020

The UK Government has issued its Energy White Paper, detailing how they plan to power the net-zero future they have been striving to achieve.

Chris Gill, Projects and Investments Director at Kajima Partnerships, discusses and explains the White Paper in further detail.

The release of the Government’s Energy White Paper has been long-awaited. While the recent 10 Point Plan overlooked some key elements vital in reaching net-zero, such as wider investment in solar energy, the White Paper presents a far more holistic approach.

This approach will likely prove a capable strategy at tackling our environmental crisis. For example, while the White Paper is planning for a doubling of electricity demand as transport and heat switch from fossil fuels to electricity, it is also aware that this sector has been one of the fastest to decarbonise. It is therefore vital that we plan for other sectors to follow suit.

The White Paper models a range of options, including hydrogen, in order to make our buildings and infrastructure more efficient. Crucially, the Government has not overlooked the potential risk electrification could bring to our power supply and will look to introduce a range of new flexibility products, ensuring the grid is not overloaded at peak times.

A core feature of the report, unsurprisingly in light of the 10 Point Plan, is further detail on the Government’s plans to decarbonise gas and end its use in our homes. Following the 10 Point Plan’s designs to install 600,000 new electric heat pumps each year by 2028, the White Paper details that we can expect a consultation on ending these natural gas connections to homes by 2025 and that by 2030 all newly installed heating systems will be low carbon or appliances easily converted to a clean fuel supply.

With gas on the way out, nuclear is making its way to centre stage. Leading on from the £385 million Advanced Nuclear Fund created to develop a Small Modular Reactor (SMR) design and build an Advanced Modular Reactor (AMR) demonstrator by the early 2030s, this White Paper also outlines the Government’s plan to bring at least one large nuclear project to Final Investment Decision stage by the end of the current Parliament. It is great to see the direct action the Government is taking to decarbonise and revolutionise our power provision in the UK.

Thankfully, the Energy White Paper has not forgotten the implications of Brexit on sustainability plans. Notably, the route for carbon pricing following the Brexit transition period must be considered. As of late, carbon pricing has followed the EU Emissions Trading Scheme (ETS) but the White Paper has now confirmed that, instead of the potential carbon emissions tax, there will be a UK ETS. This will initially apply to energy-intensive industries, electricity and aviation before expanding more widely to other sectors.

Aside from the time and effort the Government has clearly put into ensuring our net-zero plan is as comprehensive as possible, I am pleased to see the focus of the first chapter of the White Paper outlining how consumers can share the cost of decarbonisation fairly.

The road to achieving our sustainability goals must include both governmental and consumer drives, which is why it is particularly exciting to the see the White Paper reaffirm a commitment to including solar in upcoming rounds of the UK Government’s Contracts for Difference scheme. The White Paper recognises the crucial role of solar power as a key building block in establishing diverse sources of renewable energy for the years ahead – an exciting step forward if the UK is to meet its net-zero carbon target by 2050.