Government should phase out coal by 2023 to better incentivise new gas plant and mandate 10GW of energy storage and demand-side response by 2030, according to a report by a green-leaning Conservative think tank.
Bright Blue’s Keeping the Lights On report outlines scenarios for security of supply and decarbonisation. While engineers have warned that the UK faces a massive generation gap when coal closes in 2025, the think tank suggests otherwise. It believes renewable power can fill the generation gap left in the late 2020s by a potential failure to construct Hinkley Point C and recommends government makes this approach its plan B, given that renewable costs continue to fall. It places little faith in small modular nuclear reactors being available by 2030, if at all.
Bright Blue says its ‘low stress’ scenario is the most secure and least polluting approach, which also places the lowest cost on energy bills.
Under that scenario, only 8GW of new gas beyond what is already committed would be needed by 2030, according to the report. Government should encourage renewables, interconnection and energy efficiency, it recommends. Government should also develop targets for 4-5GW of DSR and 5-6GW of storage by 2030, states the report, as well as plans for small reciprocating gas engines, which it says can balance out intermittent renewables more cost effectively than large scale plants.
Meanwhile policymakers should implement an emissions performance standard (EPS) to bring coal off the system and provide a clearer signal for new gas developers. Without that signal, little new gas will be built until coal is phased out at the end of 2025, according to the think tank.
Under all its scenarios, UK lights will stay on and no new gas is required over the next four years, according to Bright Blue, which said it would shortly publish recommendations for energy efficiency policy via a separate report.
Download the full report here.
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