Analysis: Half of UK’s electricity to be renewable by 2025

Close to half of the UK’s electricity will come from renewable sources by 2025, according to Carbon Brief analysis of new government projections.

This marks a significant increase on earlier projections, which as recently as 2016 saw renewables meeting less than a third of demand in 2025. At the same time, there are further cuts to the outlook for gas-fired electricity generation, which is now set to drop by two-fifths over the next six years.

Nevertheless, the projections show the UK missing its legally binding carbon budgets for 2023- 2032 by even wider margins than expected last year. The fifth carbon budget for 2028-2032 is now set to be missed by as much as 20%, according to the new energy and emissions projections from the Department for Business, Energy and Industrial Strategy (BEIS).

These latest projections highlight the large gap between the UK’s current climate goals and the policies that would be required to deliver them. They arrive just weeks before the publication of formal advice that is likely to recommend even greater ambition, targeting net-zero emissions in line with the Paris Agreement.

Cheaper renewables

The government now expects close to half the UK’s electricity to be renewable by 2025, as the red line on the chart below shows. This is a remarkable increase compared to its 2016 projection, shown in light blue, which had renewables meeting less than a third of supply that year.

Renewable share of the UK electricity mix (%) between 2008 and 2035. Future projections are shown from 2016 (light blue), 2017 (dark blue) and 2018 (red). Note that the latest projections are labelled “2018”, even though they were published on 11 April 2019. The BEIS labelling is retained here for ease of reference. Source: Carbon Brief analysis of BEIS energy and emissions projections for 2016, 2017 and 2018. Chart by Carbon Brief using Highcharts.

The upwards adjustment is a reflection of the falling cost of renewables, rather than a change in government policy. Other than continued support for offshore wind, policy has generally become less favourable to wind and solar over the past several years.

BEIS explains the changes as follows:

“Increases in renewables generation are due to lower projected technology costs, whilst projected electricity demand is lower due to revisions that we made to the demand equations for the commercial and residential sectors which had been overestimating electricity demand.”

The rapid increase in renewables’ expected share of the mix means they could overtake gas as the largest source of UK electricity as soon as this year, as the chart below shows.

(Note that the projections incorrectly show renewables having already overtaken gas in 2018. Carbon Brief analysis published in January showed renewables generated 112 terawatt hours (TWh) in 2018, versus 132TWh for gas. The chart below has been corrected to reflect this.)

Top: Shares of the UK electricity mix by fuel (%) between 2008 and 2035. Future projections are shown with grey shading. Bottom: Electricity generation by fuel (terawatt hours). Source: Carbon Brief analysis and BEIS energy and emissions projections. Chart by Carbon Brief using Highcharts.

All this means the UK could hit its indicative target to cut emissions in the power sector years early. The carbon intensity of electricity supplies could fall close to 100 grammes of CO2 per kilowatt hour (gCO2/kWh) in the early 2020s, years ahead of a 2030 target date, as the chart below shows.

Carbon intensity of UK electricity supplies, grammes of CO2 per kilowatt hour. The indicative 2030 target of 100g is shaded grey. Source: BEIS energy and emissions projections. Chart by Carbon Brief using Highcharts.

This electricity mix for the UK, projected to be dominated by renewables from the early 2020s, looks very different to what was expected before.

The charts below show how BEIS has shifted its projections of electricity generation for each fuel, with the latest 2018 figures shown in red and previous figures shown in shades of blue.

Projections of UK electricity generation by fuel (terawatt hours) published in 2018 (red lines) compared to previous years between 2013 and 2017 (shades of blue). Note that the latest projections are labelled “2018”, even though they were published on 11 April 2019. The BEIS labelling is retained here for ease of reference. Source: Carbon Brief analysis and BEIS energy and emissions projections. Chart by Carbon Brief using Highcharts.

This electricity mix for the UK, projected to be dominated by renewables from the early 2020s, looks very different to what was expected before.

The charts below show how BEIS has shifted its projections of electricity generation for each fuel, with the latest 2018 figures shown in red and previous figures shown in shades of blue.

Not hitting targets

Despite these changes in the electricity sector, the UK is now set to miss its climate goals by even larger margins than expected last year.

Broadly speaking, this is because the electricity sector is the only area where significant, continued CO2 cuts are expected to be made, as the chart below shows. All other sectors of the economy are projected to see either modest declines or small increases, whereas cuts will be needed in all areas to stay within budget.

Past and projected future emissions in the UK, by sector, millions of tonnes of CO2. Projections are shaded grey. Source: BEIS energy and emissions projections. Chart by Carbon Brief using Highcharts.

(Note that technically, emissions in the power sector do not count towards the UK’s carbon budgets. Instead, the UK’s share of the annul cap under the EU Emissions Trading System is counted towards the UK’s “net carbon account”. For more details see this earlier Carbon Brief article.)

The gap between expected emissions across the whole economy and the fifth carbon budget for 2028-2032 is now between 6% and 20%, the BEIS projections show, with a central estimate of 10%.

This central estimate includes a “subset of early stage policies and proposals from the clean growth strategy”, which cut the deficit from 14% down to 10%. Accounting for the uncertainty in the projections, the gap to meeting the fifth budget could be as small as 6% or as large as 20%.

This gap between current policy and what would be needed to meet the UK’s climate goals is even wider than last year. In 2017 BEIS estimated that the gap to meeting the fifth carbon budget was 7% (2-17%).

This worsening outlook is shown in the chart below. The latest projections are shown in red, with those from 2017 in blue and the five-yearly carbon budget limits in black.

Projections of UK greenhouse gas emissions published in 2017 (blue) and 2018 (red), versus the five-yearly carbon budgets set in law (millions of tonnes of CO2 equivalent). Source: BEIS energy and emissions projections for 2017 and 2018. Chart by Carbon Brief using Highcharts.

According to BEIS, this worsening outlook mostly reflects improved modelling and other changes that are unrelated to policy. However, it does admit that its interventions will be less effective than expected in several areas. One is vehicle efficiency policy, where the “no policy” baseline now has fewer miles being driven, so that the potential for fuel savings is reduced.

BEIS also continues to insist that it has additional policies in the pipeline that will help close the gap to meeting future carbon budgets, which it describes as a “projected shortfall”. It says:

“We will continue with our ambitious implementation of the policies and proposals set out in the clean growth strategy to address the gap…As [they] are developed more fully, their impacts will be included in future [projections].”

The worsening outlook “will likely fuel speculation [that] the government could eventually face legal action if it fails to take sufficient steps to close the ‘emissions gap’”, says BusinessGreen.

The threat of legal action has lingered ever since the clean growth strategy was rated inadequate by the government’s official advisers, the Committee on Climate Change (CCC).

The Climate Change Act says the government: “Must prepare such proposals and policies as [it] considers will enable the carbon budgets…to be met.” The government’s latest projections show that – in its own estimation – the climate policies it has in place so far fall short of this test.

Moreover, the CCC is due to recommend even greater ambition for the UK. On 2 May it will set out how and when the country should cut emissions to net zero, in line with the Paris Agreement.

Lack of transparency

One problem with the BEIS projections is that it publishes relatively limited information about how they are compiled and what assumptions they include. This extends to even basic information such as the breakdown of different sources within the renewable total, which includes wind, solar, hydro and bioenergy.

BEIS rejected a Carbon Brief request for more detail on its modelling in 2017, under freedom of information rules. This year it has published a 19-page “methodology overview” offering brief summaries of its approach across energy demand, electricity sector modelling and so on.

This overview leaves many questions unanswered, particularly around the assumptions used. It also refers readers to documentation from 2012 on the BEIS electricity sector model, even though this model has been completely overhauled since then.

Dr Doug Parr, Greenpeace’s chief scientist, tells Carbon Brief:

“Climate policy is entering its most critical decade and UK leadership will continue to matter. So we need to know how far and how fast government proposals will actually take us, and that those proposals are robust. Unfortunately, there is not enough transparency around these projections to know that is the case. What we can see raises at least as many questions as it answers, because there are clearly some questionable assumptions.”

One example of this is the assumption that multiple new nuclear plants will be built between 2025 and 2035. As BEIS noted last year, this is “not based on developers’ proposed pipeline of nuclear projects”. Since last year’s projections, another planned new nuclear plant has been cancelled.