Open Energy Market: Top 10 trends for 2019
1. Energy Management
The demand for greater and immediate insight into energy use is set to continue, as the increasing convergence of data proves its worth to a greater number of commercial energy users. Manufacturing and industrial sectors, the traditional leaders of energy management, will find themselves joined by diverse industries as new standards are set for reporting and management.
With cybersecurity becoming an ever-more familiar part of everyday life, anxiety will grow and diversity as corporations evaluate their risk alongside threats to suppliers and networks. Growing familiarity is likely to move discussions increasingly from technology to management and bring a greater understanding of the types of attacks that can disrupt service on multiple levels, from data security to infrastructure.
No surprise that instability in global affairs will continue to impact the world energy complex after 2018 saw oil markets reach four-year highs and the S&P 500 index continue its longest ever rally. The heightened complexity of the geopolitical climate in recent years will be on the mind of many commentators heading into 2019, a year that will include the culmination of Brexit and the third year of Donald Trump’s presidency.
4. Increased Compliance
Compliance will be high in the minds of UK companies heading into 2019, as a number of mandatory schemes bed in or reach deadline.
- There will be a rush of companies seeking best practice in line with the deadline for Phase 2 of the Energy Savings Opportunity Scheme on 5 December 2019.
- Three years on from the announcement of its closure, the final Carbon Reduction Commitment allowances will be surrendered in October 2019. Building on the same framework, streamlined energy and carbon reporting regulations (SECR) will replace CRC in 2019 affecting around 12,000 companies in the UK, 8,000 more than were required to comply with CRC.
- As the first anniversary of minimum energy efficiency standard (MEES) comes around in April, the requirement for energy performance certificates (EPC) for all non-exempt sold or let commercial buildings is likely to become a more prominent issue throughout 2019.
5. Open Energy
There is great potential for the energy sector to follow the lead of the banking sector and introduce reforms that radically decrease its complexity. A recent report by the Federation of Small Businesses illustrated how the Open Energy discussion is currently centred on SME and consumer markets. 2019 should see this discussion open up to the more archaic and larger commercial users. However, data and standardised exchange mechanisms to real change and it’s likely that a shift in regulation and legislation will come first to power the change.
6. Diversification of Energy Technology
The deployment of technology to assist with energy procurement and management will increase in companies of all sizes, as consumer-level innovations factor into the commercial sector. As it does, the conversation around it will become more sophisticated. Offerings including integrated platforms, technology or service as a service will continue to offer different benefits to businesses although clearer routes to convergence and a Smart future will emerge.
7. Increasing emergence of Demand Response
2019 is likely to see the rapid expansion of Demand Side Response as incentivisation reaches smaller companies and the technology surrounding it develops a new level of automation. The potential to save energy, cut carbon emissions, and provide a company with recurring revenue as they reduce demand during low-frequency events and allow access to their generated assets during peak times will be transformative for the energy complex.
8. Renewable energy consolidating CSR
As the last of the Millennial generation near 20, the need for companies to place CSR at the heart of their culture will become ever more essential. Sustainability will become the core goal for many businesses, vital to attract and retain stakeholders at every level of a business, with energy use and efficiency at the heart of it. The upward trend of consumers preferring sustainable products and causes will become standardised as Millennials take the majority of management positions.
9. Energy storage
The technology and understanding of energy storage will continue to develop as the technology becomes more viable and attractive for smaller businesses. The routes to energy, particularly through renewable means, will diversify and will receive a far greater level of media attention. Energy storage will become the stable basis for the majority of new energy technologies from now on.
It’s a term that’s unlikely to leave the energy industry anytime soon. Over a year after Europe’s first blockchain project designed to stabilise the power grid, 2019 will see the discussion over blockchain technology’s role in the energy network alive and well. The question is whether 2019 is the year that Blockchain can tip from theory to positive disruption, while considerable expectation remains, and how the energy sector can successfully decentralise at the same time as vastly improving transactional quality.
Chris Maclean is the CEO and co-Founder of Open Energy Market
UK must stop blundering into high carbon choices warns CCC
The UK Government must end a year of climate contradictions and stop blundering on high carbon choices, according to the Climate Change Committee as it released 200 policy recommendations in a progress to Parliament update.
While the rigour of the Climate Change Act helped bring COP26 to the UK, it is not enough for Ministers to point to the Glasgow summit and hope that this will carry the day with the public, the Committee warns. Leadership is required, detail on the steps the UK will take in the coming years, clarity on tax changes and public spending commitments, as well as active engagement with people and businesses across the country.
"It it is hard to discern any comprehensive strategy in the climate plans we have seen in the last 12 months. There are gaps and ambiguities. Climate resilience remains a second-order issue, if it is considered at all. We continue to blunder into high-carbon choices. Our Planning system and other fundamental structures have not been recast to meet our legal and international climate commitments," the update states. "Our message to Government is simple: act quickly – be bold and decisive."
The UK’s record to date is strong in parts, but it has fallen behind on adapting to the changing climate and not yet provided a coherent plan to reduce emissions in the critical decade ahead, according to the Committee.
- Statutory framework for climate The UK has a strong climate framework under the Climate Change Act (2008), with legally-binding emissions targets, a process to integrate climate risks into policy, and a central role for independent evidence-based advice and monitoring. This model has inspired similarclimate legislation across the world.
- Emissions targets The UK has adopted ambitious territorial emissions targets aligned to the Paris Agreement: the Sixth Carbon Budget requires an emissions reduction of 63% from 2019 to 2035, on the way to Net Zero by 2050. These are comprehensive targets covering all greenhouse gases and all sectors, including international aviation and shipping.
- Emissions reduction The UK has a leading record in reducing its own emissions: down by 40% from 1990 to 2019, the largest reduction in the G20, while growing the economy (GDP increased by 78% from 1990 to 2019). The rate of reductions since 2012 (of around 20 MtCO2e annually) is comparable to that needed in the future.
- Climate Risk and Adaptation The UK has undertaken three comprehensive assessments of the climate risks it faces, and the Government has published plans for adapting to those risks. There have been some actions in response, notably in tackling flooding and water scarcity, but overall progress in planning and delivering adaptation is not keeping up with increasing risk. The UK is less prepared for the changing climate now than it was when the previous risk assessment was published five years ago.
- Climate finance The UK has been a strong contributor to international climate finance, having recently doubled its commitment to £11.6 billion in aggregate over 2021/22 to 2025/26. This spend is split between support for cutting emissions and support for adaptation, which is important given significant underfunding of adaptation globally. However, recent cuts to the UK’s overseas aid are undermining these commitments.
In a separate comment, it said the Prime Minister’s Ten-Point Plan was an important statement of ambition, but it has yet to be backed with firm policies.
Baroness Brown, Chair of the Adaptation Committee said: “The UK is leading in diagnosis but lagging in policy and action. This cannot be put off further. We cannot deliver Net Zero without serious action on adaptation. We need action now, followed by a National Adaptation Programme that must be more ambitious; more comprehensive; and better focussed on implementation than its predecessors, to improve national resilience to climate change.”
Priority recommendations for 2021 include setting out capacity and usage requirements for Energy from Waste consistent with plans to improve recycling and waste prevention, and issue guidance to align local authority waste contracts and planning policy to these targets; develop (with DIT) the option of applying either border carbon tariffs or minimum standards to imports of selected embedded-emission-intense industrial and agricultural products and fuels; and implement a public engagement programme about national adaptation objectives, acceptable levels of risk, desired resilience standards, how to address inequalities, and responsibilities across society.
Drax Group CEO Will Gardiner said the report is another reminder that if the UK is to meet its ambitious climate targets there is an urgent need to scale up bioenergy with carbon capture and storage (BECCS).
"As the world’s leading generator and supplier of sustainable bioenergy there is no better place to deliver BECCS at scale than at Drax in the UK. We are ready to invest in and deliver this world-leading green technology, which would support clean growth in the north of England, create tens of thousands of jobs and put the UK at the forefront of combatting climate change."
Drax Group is kickstarting the planning process to build a new underground pumped hydro storage power station – more than doubling the electricity generating capacity at its iconic Cruachan facility in Scotland. The 600MW power station will be located inside Ben Cruachan – Argyll’s highest mountain – and increase the site’s total capacity to 1.04GW (click here).
Lockdown measures led to a record decrease in UK emissions in 2020 of 13% from the previous year. The largest falls were in aviation (-60%), shipping (-24%) and surface transport (-18%). While some of this change could persist (e.g. business travellers accounted for 15-25% of UK air passengers before the pandemic), much is already rebounding with HGV and van travel back to pre-pandemic levels, while car use, which at one point was down by two-thirds, only 20% below pre-pandemic levels.