By Tom Williams,
Companion, Head of Vitality & Infrastructure,
Downing LLP
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2022 was a yr shrouded in unpredictability for the power sector and 2023 seems like it’ll be one other rollercoaster. But 2023 will in the end achieve success for these that may navigate important dangers and seize the distinctive alternatives the power sector is prone to generate.
Vitality safety
Vitality safety stays a major problem. The UK must prioritise renewable infrastructure funding, as a step again now can be detrimental to our capacity to take management of our power manufacturing and our internet zero ambitions. We’re all absolutely conscious of the knock-on results of our dependence on international fossil fuels and its costs– let’s not proceed to be on the mercy of exterior elements.
UK Electrical energy Generator Levy
With the UK Authorities’s Electrical energy Generator Levy coming into impact in January, it’s regarding that renewable power operators are dealing with a windfall tax. This doesn’t tackle the basis reason behind the rises in energy costs. The federal government dangers placing the handbrake on improvement of recent renewable power tasks, which is the precise reverse of what we have to safe our power provide, not to mention scale back emissions and meet our internet zero targets.
UK coverage atmosphere
Flip-flopping on fracking, onshore wind, ignoring farmers and the NFU on renewables and meals safety and re-opening coal mines is just not useful. A considerate and steady coverage atmosphere is important for the UK to maximise its renewable era.
Wanting past core renewables
Our sturdy perception is {that a} diversified portfolio of applied sciences spanning our nation’s various geographies will enable us to harness a number of climate techniques on particular person days and make provide and energy pricing smoother for mills and customers alike. The UK has wind, solar and water in abundance, we needs to be utilizing all of the core renewable power applied sciences out there to us. Investments in storage and tasks geared toward delivering ancillary grid companies are wanted with a view to benefit from this wealth of pure assets.
Energy costs
Till provide and demand rebalance, we is not going to see any return to normality. Though we anticipate energy costs to stay excessive and even turn into extra unstable, it’s important to retain a practical long-term outlook, which would require a stable understanding of the behaviour of energy costs in each particular area or geography.
The aftermath of COP27
This isn’t the time to take our foot off the pedal with renewable power. Nobody needs to depend on unfavorable carbon to deliver us again from the brink. Renewables are an enormous a part of the reply and funding should proceed to extend considerably from each the Authorities and personal sector.
