Ben Brading 5 min read

Decarbonisation of the national grid

Decarbonisation of the national grid is a necessary step and a key milestone in achieving the UK’s legally binding target of reaching net zero by 2050.

Decarbonising the grid is expected to result in significantly cheaper and cleaner electricity, which will be required for the widespread adoption of heat pumps and electric vehicles.

This article outlines the targets, progress, strategies and challenges involved in the decarbonisation of the national grid.

Key targets for decarbonising the national grid

The UK Climate Change Act of 2008 made the UK the first country in the world to adopt legally binding emission targets, requiring the UK to reduce its greenhouse gas emissions by at least 80% compared to 1990 levels by 2050.

In 2019, Theresa May’s Conservative government strengthened the legislation by introducing the net-zero by 2050 target.

As part of its roadmap to net zero, the Labour Party has committed to delivering a zero-carbon electricity grid by 2030.

Progress in decarbonising the national grid

The UK has made significant progress towards decarbonising the national grid, with the use of fossil fuels falling by 63% and renewable energy generation increasing fivefold since 2010.

According to the Department for Energy Security and Net Zero statistics from 2023:

60.3% of electricity was generated from low-carbon sources:

46.4% from renewables, the majority supplied by UK wind farms.
13.9% from UK nuclear power plants (a non-renewable but low-carbon energy source).

39.7% of electricity generation came from the combustion of fossil fuels, directly producing greenhouse gases:

34.7% from gas power stations.
1.3% from coal power stations.
3.7% from other fuel sources, including electricity generated by waste-to-energy facilities.

Public awareness of climate change has increased the popularity of renewable domestic and green business energy tariffs that supply electricity exclusively from low-carbon sources.

Another encouraging development is the improvement in business energy efficiency, which has contributed to a reduction in overall electricity consumption. Total business energy consumption in 2023 was down 22% compared to 2010.

Decarbonisation strategy and challenges ahead

The government’s strategy for grid decarbonisation aims to significantly increase low-carbon power generation to replace fossil fuels. Key targets include:

Quadrupling offshore wind capacity.
Doubling the capacity of onshore wind farms.
Tripling solar power generation.
Completing the construction of the Hinkley Point C and Sizewell C nuclear power stations.

Delivering this additional green generation capacity to the national grid presents three major challenges, which we’ll summarise below, along with the current strategies for overcoming each.

Encouraging renewable investments

The new Labour government does not plan to invest directly in renewable energy generation. Instead, it seeks to encourage private firms, such as business energy suppliers, to invest in wind and solar farms.

Renewable energy projects require substantial upfront investment, with investors facing considerable uncertainty about future electricity sale prices. To incentivise green power investment, the UK government plans to:

Reduce planning requirements for new renewable projects and lift the ban on onshore wind farm developments.
Expand the Contracts for Difference scheme to guarantee a fixed price for electricity generated by renewable projects.
Invest in renewable energy technology through GB Energy, aiming to improve the efficiency of renewable projects and make the cost of energy generation more competitive.

Balancing intermittent renewables

The plans for grid decarbonisation involve significantly larger amounts of solar and wind generation replacing power generation from gas-fired power stations.

This poses a significant problem for the national grid because, unlike renewable energy generation, gas power’s output is predictable and adjustable, allowing the grid operator to balance demand against supply.

Power generation from renewables depends on the weather, which is inconsistent and unpredictable, making grid balancing more difficult. The problem of balancing inconsistent renewables is being tackled by:

Encouraging investment in zero-carbon energy storage solutions like pumped-hydro, green hydrogen and battery storage with capital grants.
Introducing demand-side management, including multi-rate business energy tariffs and schemes like the demand flexibility service.
Maintaining a strategic reserve of gas power stations as a backup to renewables, investing in carbon capture and storage to decarbonise this necessary backup.

💡The balancing activities of the national grid are paid for by BSUoS charges. The energy regulator Ofgem is expected to allow significant rises in BSUoS charges to support decarbonisation efforts.

Upgrading grid infrastructure

The current national grid infrastructure is designed to efficiently distribute electricity generated from centrally located gas and nuclear power stations to homes and businesses across the country.

Plans to decarbonise the grid will shift electricity generation predominantly to offshore wind farms in the North Sea, far from the South East of England, which has the highest demand for power. This will require significant investment in high-voltage power lines to address the geographical mismatch between generation and demand.

In addition, the number and speed of connections to the grid must increase dramatically to support the development of new solar and wind farms.

The following initiatives are being implemented to upgrade grid infrastructure:

Streamlining the planning system will allow new power lines and other infrastructure to be built more quickly.
Improving the connections queue process by introducing strategic capacity hubs and fast-tracked connections.
Increasing DUoS and TNUoS charges to fund greater investment by the national grid and regional distribution network operators.

Public sentiment challenges

Addressing the challenges outlined above will require increased investment and operating costs for the national grid, leading to higher prices in the short term. Additionally, community opposition to local infrastructure developments presents a significant hurdle.

The current government’s ambitious plan to make Britain a clean energy superpower combines grid decarbonisation with a commitment to significantly reducing domestic and business electricity prices.

Regardless of its short-term impact on pricing, decarbonisation is essential to ensuring energy security and maintaining the UK’s leadership role in combating climate change.

We hope this article has provided insight into the progress made so far and the steps ahead in achieving a clean energy future.