Renewables In 2020 And Beyond
Paul Sheffield, Managing Director, Drax Customers, explores how the next ten years will turn up the heat for using renewable energy
Renewable energy has grown exponentially over the last 10 years. In 2017, the UK had its first coal-free day; in 2018, that figure tripled. Then in May this year, Britain went a week without using coal to generate electricity; the first time this had happened since Queen Victoria's reign. It was a key milestone in the nation's move away from fossil fuels, achieved in part by the rapid growth of renewables
There are three critical areas that will fuel the UK's low carbon revolution in 2020 and beyond: investment, innovation, digitisation.
1. Greater investment and increased urgency
In November 2019, the United Nations warned that emissions are not being reduced quickly enough and that the world's on course for a temperature rise of 3.2°C by the end of this century. The UN report states that, to avoid global warming of more than 1.5°C, all countries have to increase their carbon-cutting aspirations five-fold.
As the UK Government has declared its own ambitious target for net-zero carbon emissions by 2050, it's likely that new incentives for green energy will be forthcoming. Penalties for depleting resources may come along, too. As a result, UK businesses will have no choice but to adapt.
In addition, the government's new policy and investment framework will be essential to encouraging the growth of negative emissions technologies to help the UK become carbon negative.
2.New innovative technology
Innovative technological progress is changing how renewable energy is produced, bringing prices down in the process.
Recent breakthroughs include bladeless wind turbines - a quieter, cheaper and less invasive alternative to traditional turbines - while Scotland plays host to the world's first kite farm. This has 20 kites flying higher than the Shard to generate electricity for an estimated 5,000 homes.
What's more, electric vehicles (EVs) are on the verge of mass market adoption as technology advances while costs fall. Propelled by new batteries, faster charging and longer life cycles, EVs can now travel further between charges, reducing users' fears of being stranded and making them more attractive to new buyers.
There are also new and more efficient ways to store and distribute surplus energy. Critically, these new technologies will work in harmony with each other: for example, pairing batteries with solar panels and wind turbines to produce green energy at scale.
3. Realising the potential of digitisation
Digitisation is set to revolutionise the energy sector. Potentially, the Internet of Things (IoT) and Big Data will allow for the analysis and better management of energy. In time, digital systems will make renewable energy far more accessible to all businesses. These systems include smart meters, intelligent grids and automated demand side response (DSR), which changes consumption patterns in accordance with peaks and troughs from the electricity supply.
Together, the new digital systems will better support and encourage prosumers - those organisations that both produce and consume energy. In turn, this will help distribute energy resources more widely and underpin the move away from today's aging centralised power grid to a new “Smart Grid”. This new system will be decentralised, as well as more efficient and reliable, and be fit for the 21st century and beyond.
A new energy era for businesses
This new era of renewable energy will present opportunities to businesses. Power Purchase Agreements (PPAs), for example, will allows suppliers to buy renewable energy from the businesses generating it - and develop their own energy storage solutions.
Businesses can also benefit from DSR schemes that allow them to use electricity more efficiently and reduce their expenditure at the same time. For example, a business that turns down the lights when demand from the grid is at its highest will improve the efficiency of its operations and save money.
Colchester Hospital NHS Trust is a real-life example of such a scheme in action, running a combination of various DSR services. Using a bespoke solution, the hospital can control its various generators remotely with real-time metering hardware and a combination of existing and new control systems. This helps it to minimise or avoid consumption at peak times, and to save money as a result
Demanding more from energy suppliers
Operating more sustainably has become a universal goal for businesses and this means the energy sector is becoming increasingly service-driven. Energy suppliers that recognise (and help drive) this change will be able to offer a range of solutions that help businesses overcome their energy challenges.
Some energy suppliers are readily responding to the demands of business customers. Services include managing contracts and risk through to investing in low carbon generation and communicating customers' Corporate Social Responsibility (CSR) strategies. In this ever-changing environment, companies are experiencing more intense social and environmental pressures from their customers. Engaging with energy suppliers that can respond ably and consistently could be key to businesses achieving continued loyalty from their customers.
Historically, dealing with an energy supplier has been a one-way process for businesses. Now, technological innovation is helping to change this. Communication is key and it's becoming a more flexible two-way process. Businesses will benefit from engaging with energy suppliers that are forward-thinking, take the time to listen, and can provide flexibility. Energy suppliers should also be able to demonstrate how they're already helping customers to operate more cost-effectively and with more energy efficiency.
