The Energy Transition | Grid flexibility service cuts Britain's winter electricity use by 3.3GWh

This week we look at the results of the Demand Flexibility Service, the government's plans to draw up a "treasure map" to gauge UK undersea CO2 storage potential, and more.

Grid flexibility service cuts Britain's winter electricity use by 3.3GWh

The Electricity System Operator (ESO) has reported the results of its Demand Flexibility Service (DFS), which was put in place during the winter of 2022/2023. The ESO confirmed that the DFS saved over 3,300MWh of electricity which roughly equates to the amount of electricity that 9.9 million households would use at peak times across a single hour.

The service involved consumers and businesses reducing their demand at peak times. It ran from 1 November 2022 until 31 March 2023, and involved 22 demand reduction sessions that covered live events and monthly tests.

1.6 million households and businesses signed up to the scheme. The ESO noted that participants in Southern England, East of England and East Midlands regions led the way in terms of participation in the DFS, with each region delivering an estimated electricity reduction of over 370MWh across the length of the service.

Octopus Energy and British Gas also announced that their DFS schemes have shown positive results, with Octopus Energy reporting that customers saved 1.86GWh of electricity throughout 13 sessions.

Following this announcement, Claire Dykta, Head of Markets at National Grid ESO stated that: “[a]cross this winter the Demand Flexibility Service successfully demonstrated the interest of UK consumers and businesses in playing a more active role in balancing our electricity needs. Their work, alongside the providers involved in the Demand Flexibility Service helped to maintain normal service for all GB electricity users.”

Government to draw up "treasure map"' to gauge UK undersea CO2 storage potential

The government has announced plans to grant the carbon storage regulator, the North Sea Transition Authority, powers to obtain information and samples about the carbon capture capabilities of the North Sea from those who already have a licence to drill under the seabed. These powers will help to develop a "treasure map" of the geology of the North Sea, to enable decision-making and unlock new investment in carbon storage.

The UK plans to store 20 to 30 million tonnes of carbon dioxide per year by 2030 which is equal to removing up to six million cars off UK roads each year. The North Sea Transition Authority has welcomed the proposals, with Chief Executive, Stuart Payne commenting that, "carbon storage is essential to reaching net zero, and the industry requires a wealth of reliable information to select sites to store millions of tonnes of greenhouse gases."

Secretary of State for Energy Security and Net Zero, Grant Shapps, said: "the UK is in prime position to become a world leader in carbon capture and storage – a whole new industry that could boost our energy security, help cut our own emissions and those of our European neighbours and create thousands of jobs for the future."

The new powers would take effect through a proposed amendment to the Energy Bill. Other amendments to the Bill, which were proposed during its reading in the House of Lords, include giving Ofgem a net zero remit and the introduction of a levy on consumer bills to fund the development of hydrogen. The Bill is currently being reviewed by the Public Bill Committee, which is expected to report to the House of Commons by 29 June.

Government holds its first-ever Net Zero Council

The government held the first meeting of the Net Zero Council on 9 May. The meeting was co-chaired by Energy Minister Graham Stuart and Co-op Group chief executive Shirine Khoury-Haq, and was attended by leading banks, energy companies, technology and finance firms including Siemens, SSE, HSBC and Lloyds of London.

The aims of the Council include:

• working to ensure sectors and companies have a pathway to net zero, including looking at the barriers and connections across sectors; and
• undertaking a review of the financing challenges faced in achieving net zero and the roles of government, industry and the financial sector in addressing those challenges.

At the first meeting, the Council discussed the importance of building one coherent voice across government, finance and business to support the UK’s key sectors in the net zero transition.

Energy Minister Graham Stuart said: "[t]he Net Zero Council provides the high-level forum for government, business and finance leaders to work together to unlock the opportunities of the green transition."

The Council will meet on a quarterly basis going forward.

Government launches a consultation on energy bill discounts for communities that host new onshore wind farms

The Department for Energy Security and Net Zero has launched a consultation on the addition of innovative forms of community benefit to the range of reward schemes offered to host communities by onshore wind developers currently.

The benefits proposed include issuing vouchers that can be redeemed with energy suppliers, translating co-ownership shares in the wind infrastructure owned by the community into discounts on electricity bills, or by reducing the cost of electricity for local consumers when the wind is blowing with innovative tariffs.

These changes would be achieved by updating RenewableUK’s existing Community Benefits Protocol for England, and agreed between developers and communities on a case-by-case basis.

Minister of State for Energy Security and Net Zero Graham Stuart said: "Onshore wind is a vital part of our plans to deliver cheaper, cleaner, and more secure homegrown energy. It is right that new developments have the support of host communities, and that local people benefit directly from it, such as through either a discount on their energy bills or other significant community benefits."

RenewableUK’s Head of Onshore Wind James Robottom said: "Alongside much-needed planning reforms, this consultation provides an opportunity to increase the amount of cheap clean power we can generate for consumers as well as strengthening our nation’s energy security."

The consultation closes on 7 July 2023.

UK wind power exceeds gas generation for first time

For the first time, Britain's wind turbines generated more electricity in a quarter year than gas-fired power stations, according to the latest report from Drax Electric Insights, an independent report by academics from Imperial College London.

32.4% of Britain’s electricity was supplied from wind power during the first quarter of 2023, outpacing gas which delivered 31.7%. Output from wind was 3% higher than during the same quarter last year, with gas down by 5%.

The report also found that renewable sources were responsible for almost 42% of Britain’s electricity in the first quarter of this year.

This article was written with the assistance of Amy Lewis and David Herron, trainee solicitors.