The UK’s new Labour Government has great ambitions for accelerating the deployment of wind energy, both onshore and offshore. To deliver on their new goals they will need a massive overhaul of planning and the grid.
The new UK Government is committed to double onshore wind and quadruple offshore wind by 2030, as a cornerstone of its goal to fully decarbonise electricity by 2030. That means increasing onshore wind from 15 to 30 GW and offshore wind, where they’re already no 1 in Europe, from 15 to 60 GW. These are hugely ambitious targets.
Planning and consenting
To fully deliver, the new Government will need a massive overhaul of the UK’s approach to planning and deployment, both of wind farms and the relevant grid infrastructure. They’ve made a great start by lifting the de facto ban on onshore wind in England on their first full working day in power. However, consenting is still a major bottleneck and the UK Energy Act has committed to reducing consenting timelines. Labour has announced a consultation on whether to include larger onshore wind projects in the Nationally Significant Infrastructure Project (NSIP) regime, which would enable consenting decisions for those projects to be made at a national level through a fast-tracked process.
Electricity grid
The new Government is saying the right things on the need to rapidly expand the electricity grid. Five times more electricity infrastructure needs to be constructed by 2030 than in the past three decades to deliver a net zero grid.
Planning departments need more resources to make timely permitting decisions. Community engagement and community benefits should be further incentivised. Improving digitalisation and data management will also help to integrate increasing amounts of variable renewable energy.
Actions cannot come soon enough. Lacking grid infrastructure is clogging the consenting process. According to a new WindEurope report more than 100 GW of wind energy projects in the UK are waiting for their grid connection assessment.
GB Energy
The new Government will also need to mobilise massive amounts of investment. A lot will ride here on the new state-owned company the Government is setting up called ‘Great British Energy’. GB Energy will make its own investments and leverage private investments in energy infrastructure. It will have 3 main focuses: deploying existing technologies, incentivising emerging technologies and increasing community ownership, with £3bn to be invested in local community projects as part of its initial £8.3bn endowment. This is great – though private investment will do the heavy lifting when it comes to delivering on new targets.
Offshore wind auctions
Delivering the huge expansion in offshore wind will require changes to the UK’s auction system. The auction design is good – 2-sided CfDs. But the Governments needs to increase the budget for the current AR6 auction and then future auction rounds to unlock the volumes needed to meet its targets. In 2023 the Contracts for Difference (CfD) auction round for offshore wind (AR5) failed to attract a single bidder. This meant valuable time was lost and future auctions now need to procure a greater amount of new renewable energy to ensure government targets remain on track to be met.
The current offshore wind auction has an £800m budget, which is only enough for about 4 GW of new capacity. The Government must increase that budget if they want to get anywhere near the ramp-up needed for the 60 GW target. Not least when Germany is auctioning 8GW of offshore wind this year, Denmark at least 6 GW, the Netherlands 4 GW, and Belgium over 3 GW.
UK-EU energy relationship
The UK and the EU can help each other significantly in their respective energy transitions, especially on offshore wind. Every country around the North Sea is building offshore wind. It’s in all their interests to collaborate and coordinate, especially on the build-out of the offshore grid connections. There are real gains to be had from different countries connecting their offshore wind farms to optimise grid investments and maximise power flows. It’s a no-brainer that the EU and UK reinforce their collaboration in the North Seas Energy Cooperation (NSEC). The EU and UK also need to find a solution as soon as possible on the post-Brexit electricity trading framework to deliver the best value for both UK and EU consumers.
WindEurope CEO Giles Dickson said: “Few Governments have ever come into office in Europe with so much ambition for wind energy and so much clarity and common sense on how to deliver those ambitions. And they’ve got off to a great start by removing on day 1 the rules blocking onshore wind in England. It’s crucial they now raise the budget for the current offshore wind auction to get more new projects through. And that the EU and UK quickly work out how they can collaborate to develop their huge collective resource that is North Sea offshore wind.”
