Renewable energy investment rises in the UK
Investment in renewable energy is rising, putting the UK on track to meet its clean energy commitments.
Clean energy in the UK continues to be a hot topic, especially since the government committed to produce 15 per cent of its energy from renewable sources by 2020. Investors in renewable energy range from venture capitalists and the government, to crowdfunded initiatives like the Trillion Fund, which means there’s a lot of money being pumped into sustainable energy.
Investment has seen rapid growth in offshore and onshore wind farms and more recently solar energy. However, while around 15 per cent of the UK’s electricity is generated from clean methods, Britain is only around halfway to meeting its goal. This is due to the overall target including energy use includes transport and heating, as well as electricity generation.
Despite this, 2015 has already seen a number of moves to push investment in renewables, so there’s hope yet for the UK to meet its target by 2020.
The growing trend of investment in clean energy was recently highlighted when Innovate UK, the government-backed technology agency, dished out its latest round of funding as part of its Energy Catalyst initiative.
Forty early-stage energy firms have been chosen to receive a share of £24.5 million funding for research and development, and the firms will represent a wide range of technologies in the sector.
"The projects that have won funding in this first round are exactly the sort of innovative ideas we had in mind when the energy catalyst was created," said Rob Saunders, head of energy at Innovate UK.
"The second round is well under way and I'm certainly looking forward to seeing UK firms come forward with more new ways of securing a reliable, low carbon and low cost energy system," he added.
Innovate UK is still inviting bids for the second round of Energy Catalyst funding.
CFD auction for renewable energy
The UK government recently announced the results of a new Contracts for Difference (CFD) auction that awarded 27 companies with low carbon energy contracts. A range of companies, including small developers and independent generators, have secured the 15-year contracts that have a total annual spend of about £315 million a year.
A Bloomberg article points out that, as a number of the contracts will go towards solar energy projects, it will mean that the price of solar power in the UK could fall as low as those of fossil fuels. This was because the competitive nature of the auction drove down prices to secure the best deal for the consumer, according to energy secretary Ed Davey.
"These projects could power 1.4 million homes, create thousands of green jobs and give a massive boost to home-grown energy while reducing our reliance on volatile foreign markets,” he added.
Renewable energy is doing its bit for the climate, however, a lot will hinge on whether the next government also supports the EU energy target goals.
The UK will need to increase electricity generation from renewable sources up to 30 per cent of the total, if it wishes to meet the overall clean energy target of 15 per cent by 2020. Of course, if Britain steps up its progress on renewable heat and renewable transport then this will help offset the amount of clean energy that needs to be generated. Unfortunately, there is currently little progress in this area.
“Whichever party is in government next, it looks likely that they’ll need to consider an even more rapid scaling up in the generation of renewable electricity than currently planned over the next five years,” said Gordon Edge, director of policy at Renewable UK, “or the UK will risk falling short of the overall target.”