The UK needs an investment of up to £330 billion by 2030 to secure supply and reach its carbon emissions reduction targets, according to a report from the London School of Economics and Political Science (LSE).
The npower Future Report, Energy and the economy: The 2030 outlook for UK businesses, lays out three possible scenarios for the energy and economic landscape in 2030 and the implications for business.
What the picture in 2030 will look like depends on a number of factors, including continued austerity measures and the possible ditching of carbon emissions reduction targets in favour of cheaper energy sources.
Hitting the UK’s energy and environmental targets will depend on a high degree of political cohesion and direction, says the report, which will be necessary to support the record levels of investment needed.
Alternatively, short term gains could be made by switching in a major way to gas – but this would jeopardise the UK meeting its carbon reduction targets.
And in the most negative scenario, if austerity continues to reign supreme, the UK will be left trailing Brazil, Russia, India and China as little investment is made in grid upgrades and other technologies like carbon capture and storage (CCS) and shale gas fail to get going.
“A slight change of emphasis in policy, a weakening economic picture or a preference for cheaper energy sources over low carbon energy generation could result in very different operating environments for UK businesses,” says report author Samuel Fankhauser, co-director of the Grantham Institute on Climate Change and the Environment at the LSE and member of the Committee on Climate Change. “This report shows how fragile and delicate the equilibrium of factors is for protecting the future of the UK energy industry.”
Wayne Mitchell of npower says the report is a clear “call to action” for UK businesses.
“Managing energy well and making it a strategic issue is vital. A focus on energy efficiency and making good use of self-generation energy technologies are also crucial,” he says.
The figure of £200 billion by 2020 is well recognised, but what the report shows is that nearly the same amount again will be needed over the following decade.
“It is crucial that the UK energy industry, Government and businesses work collaboratively to ensure this level of investment is secured and foundations are set for economic and environmental prosperity by 2030,” adds RWE npower’s CEO Volker Beckers.
Energy companies’ UK investment hits 20-year high (29-Oct)
CBI warns UK government away from over-dependence on gas (15-Oct)
Tighening electricity supplies could spell blackouts for UK, warns regulator (8-Oct)
Article source: http://www.energyefficiencynews.com/i/5528/