Utility Week

UTILITY WEEK | 23RD - 29TH NOVEMBER 2018 | 11 Policy & Regulation This week Clark proclaims end of energy 'trilemma' Business secretary outlines the principles for a subsidy-free and low-carbon energy system Greg Clark has unveiled reviews of network codes and the retail market in a landmark speech that included the claim that the energy "trilemma" is dead. The speech, delivered at the Institute of Directors last Thursday, laid out the business, energy and industrial strategy secretary of state's long-awaited response to the Helm review of energy policy. The speech paves the way for an upcoming policy paper on energy, which will be published in the coming weeks, and a white paper "early next year". Clark's core message was that the trilemma – the per- ceived tensions between the government's three objectives of ensuring "green, cheap and secure" energy – is "well and truly over". He said the plunging price of renewable electricity generation makes it possible that "low-carbon power actually can subtract from consumer bills". Clark added: "Moving beyond subsidy does not mean to say we are reverting to the dirty, polluting world of the past, it is one where green energy can be cheap energy." Addressing the conclusions of Helm's review, which was submitted to the government just over a year ago, Clark outlined four key principles that should underpin the transition to a subsidy-free and low-carbon energy system: market mechanisms to take full advantage of innovation and competition; government intervening to insure against shortfalls in supply and maintain options; an agile and responsive system of energy regulation to reap the opportunities of digitalisation; and ensuring that all consumers pay a fair share of system costs. DB ENERGY Government 'too slow' on efficiency The chair of Parliament's busi- ness, energy and industrial strat- egy committee has slammed the government for being "too slow" to improve the energy efficiency of the country's building stock. Rachel Reeves delivered her criticism as her committee launched a probe into whether the government's efforts to improve the energy efficiency of buildings matches its ambition to curb carbon emissions. The inquiry will examine if the government's current delivery of the energy efficiency improvements is consistent with meeting the targets set out in the clean growth strategy, and the fourth and fih carbon budgets. "Energy efficiency is vital to cutting the costs of energy for homes and businesses and is a cost-effective method of reducing our carbon emissions. In spite of this, and the inclusion of energy efficiency targets in the clean growth strategy, the current rate of improvements to buildings is far too slow," said Reeves. ENERGY CCC: bioenergy in mix could double The contribution of bioenergy to the UK's energy mix could double by 2050, according to a new report by the government's climate change watchdog. The study, published by the Committee on Climate Change (CCC) last Thursday, estimates bioenergy could meet between 5 per cent and 15 per cent of the UK's energy demand in 2050. According to the CCC's model- ling, this would cut the UK's total emissions by 50MtCO2e/yr. The committee says there is "significant potential" to increase domestic production of sustainable biomass to meet 5 per cent to 10 per cent of UK energy demand by 2050. It says the balance could be derived by a threefold increase in imports from overseas of biomass that has been sourced sustainably. EMISSIONS Call for volume- based auctions Contracts for difference auc- tions must be reformed to fill a looming hole in the UK's carbon budgets, Cornwall Insight has argued in a new report. The energy consultancy says the amount of renewable gen- eration procured in the auctions should be determined by volume targets measured in megawatt hours rather than subsidy budgets measured in pounds. Turn up the Volume says the current "spend and hope" approach creates "inherent uncertainty" as to whether enough renewable power will be secured to meet emissions targets. Clark: 'green energy can be cheap energy' Political Agenda David Blackman "Clark deserves much credit just for turning up" When Greg Clark booked a slot at the Institute of Directors to discuss the government's response to the Helm review, a Thursday in mid-November looked relatively unproblematic. But that all changed with the publication of the EU-UK with- drawal agreement on Wednes- day evening. Conservative former chancellor Ken Clarke described the ensuing day as the most dramatic he had seen in Parliament in nearly half a century as an MP. li the hurdles stopping the roll- out of onshore wind, calculated to now be the cheapest source of energy. It is probably not worth Clark picking a fight on this issue at such a sensitive political moment. Expect to see little, if any, movement on this issue until the Brexit withdrawal saga concludes in December. The energy white paper, which Clark promised will be published next year, offers an opportunity to face it head-on. With ministers dropping like flies in the morning, the business and energy secretary deserves much credit just for turning up to make the speech – although it might have felt like light relief compared with what was going on in the Commons. And he had an important message to deliver: the energy "trilemma" is dead. A reduction in the cost of renewable energy means that Clark insisted the energy system can go green without breaking the bank. It's a shame that the wider public didn't hear the message amid the Brexit furore. The obvious follow-on would be that the government should

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