Utility Week

18 | JANUARY 2023 | UTILITY WEEK Renewables jects more attractive, says Dey: "That would ultimately depress prices in Scotland and increase the favourability of building in Eng- land despite the lower wind speeds that you get in England relative to Scotland." Another stocking • ller for the industry was a comment last month by environment secretary Therese Co ey that the government is not pressing ahead with moves under Truss's government to reclassify a large chunk of agricultural land to prevent solar panels being installed on it. Berman says Energy UK is "delighted" that ministers are no longer actively consid- ering banning the use of solar on 3b class agricultural land, which he describes as "a bizarre" and a "deeply regressive step in the wrong direction". Ralston agrees: "This is exactly the time when we should be doubling down on renewables, so it's encouraging that they [the government] look like they're waking up to that idea. It's nonsensical at a time when this is the cheapest power that we can get. If the farmers want it and the public wants it, I don't know why government would block it." To get to the government's target of 70GW of solar power by 2035 may create tensions between food and energy production, says Robottom: "If you want to get anywhere near that level, the availability of suitable land for solar development is going to come under strain and you might • nd instances where there's a bit of con" ict between whether you use land for agriculture or for power." However, he says, there are solutions, such as placing solar panels on stilts, that would keep the ground free for farming. The government's moves on onshore wind help to plug one of the big gaps iden- ti• ed in the Energy Security Strategy, which was published in the spring, as does its recent commitment of additional cash sup- port for energy e– ciency measures. However, Adam Bell, former head of energy strategy at the Department for Busi- ness, Energy and Industrial Strategy (BEIS), argues that the government's package of measures still don't add up to a meaningful strategy for reforming the energy system. The relaxation of planning restrictions on onshore wind, while welcome, came about in an ad hoc fashion a™ er pressure from backbench MPs. "You've got a set of reactive measures in response to pressures in Parliament that together don't necessarily constitute an energy strategy: there's still quite a long way to go," he says. "The government isn't really in a position where it meaningfully makes choices because Parliament's not there." Analysis continued from previous page What's only "partly recognised" is an understanding of the scale of institutional changes required to deliver the transforma- tion of the UK's energy system, says Bell, who is now head of policy at consultancy Stonehaven. Much of the institutional change cur- rently in the pipeline, notably the establish- ment of an independent system operator to take over this function from the National Grid ESO, is being brought forward via the Energy Security Bill. However, re" ecting the sclerosis that has beset government amid the wider Westmin- ster turmoil over recent months, this legis- lation was paused in September and only resumed its passage in the week before Par- liament's Christmas recess began. The UK is moving "too slowly across the board" on energy policy, says Bell. "We are being held back by the fact that we can't get stu done quickly enough." The "number one" issue in this bulging policy in-tray is the government's review of the electricity market, which ministers have said little about since the consultation on it • nished during the summer, says Dey. "Cer- tainty market design is a big one," he adds. "If there's uncertainty around market design it makes it very di– cult to invest in assets that are going to be on the system for 20, 30 or 40 years. We need to make those deci- sions now: that's something that needs to be solved very quickly." The UK has set the pace on o shore wind development over the past decade. But the country now faces mounting competition in attracting low-carbon investment. "If you look at the sea change in govern- mental policy across Europe, particularly over the last nine months or so since the Ukraine crisis, pretty much every single Euro- pean country has moved to double down on energy security, which tends to be low carbon by default now. There is now really sti com- petition for parts and supply chain and for labour as well," says Berman. "There are sig- ni• cant questions as to whether our invest- ability is as robust as it£was." He adds that the government also has its work cut out to put in place a regulatory regime that ensures the UK can o er a com- petitive advantage over other jurisdictions. But pointing to the government's "arbi- trary intervention" to impose a higher wind- fall tax rate on low-carbon generation than fossil fuel production, Berman says: "It just sends a really challenging message to inves- tors about the way the UK values the low- carbon generation that's going to provide the bedrock of the net-zero economy. If there is no money to be made, it will be an incredibly costly transition that the government has to substantially • nance: that's not the most e– cient way of doing it." "If you're an investor, it [the UK] is already a more uncertain place to invest," Ralston says, adding that the UK government's rela- tive lack of ambition is re" ected by its target to reduce energy demand by 15% by 2030, which the EU aims to do this winter. However, Dey, whose company has o– ces in other European countries, believes the UK remains an attractive place to invest in net- zero infrastructure due to the "clear" direc- tion of travel the government has set. "While there are some big uncertainties in the mar- ket that probably will deter some investors, overall in the global race for net zero, the UK is still probably a leading country," he says. But there is no room for complacency, Dey says: "We've made progress over the past 12 months but we're still quite far away if we want to get to net zero." David Blackman, policy correspondent "You've got a set of reactive measures in response to pressures in Parliament that together don't necessarily constitute an energy strategy: there's still quite a long way to go." Adam Bell, head of policy, Stonehaven "You've got a set of reactive measures in response to pressures in Parliament that together don't necessarily constitute an energy strategy: there's still quite a long way to go." Adam Bell "It's going to be a bit embarrassing if they then introduce a system that's so cumbersome they don't get any onshore wind." Jess Ralston, head of energy, the Energy and Climate Intelligence Unit "It's going to be a bit embarrassing if they then introduce a system that's so cumbersome they don't get any onshore wind." Jess Ralston Unit

• Cover