The renewable revolutionNovember 2016
By Adam Woodhall — In Britain and beyond, businesses large and small are getting on with a rapid transition to renewables, despite mixed messages coming from the UK government.
Some examples of positive messages from the UK Government are: approving the Fifth Carbon Budget in June; Nick Hurd, the Minister for Industry and Climate Change, stating in September that “I am very keen to work with business to ensure that the Emissions Reduction Plan is credible and sufficiently substantial”; and then in October, the Secretary of State for Business, Energy and Industrial Strategy, Greg Clark, promising to “upgrade” the UK's clean energy system. There was, however, a lack of specific policy pledges from Clark, and now, Theresa May has recently approved the Hinkley Point C nuclear power plant.
Keeping the lights on is a responsibility of any government, and from that perspective, the fact that Hinkley could provide up to 8% of the UK’s total energy requirements provides some legitimacy to the investment. In view of the renewables revolution that is happening around the world, it is, however, a curious choice. For example, in Germany, there is an aim for 50% of energy consumption to be renewable by 2030. There was a point earlier this year when nearly 100% of the country’s power supply was clean. Portugal went one step further, with four consecutive days totally powered by renewable energy.
A huge amount of energy—and investment—is being put into clean energy generation, with 147 gigawatts of renewable electricity coming online in 2015, the largest annual increase ever and as much as Africa’s entire power generating capacity. Investors are getting the message, because, as the Financial Times pointed out, the six major renewable investment funds yield an attractive return of between 5.5% and 7%. And it’s not just money and electricity that is being produced, but also jobs, as employment in clean energy grew by 6% in 2015, with oil industry jobs contracting by 18%, according to the International Renewable Energy Agency.
Why is this renewables revolution happening? A well-known commentator on renewables is Jeremy Leggett, the chair of the financial-sector think tank CarbonTracker. Up until as recently as early 2013 Leggett was expressing pessimism regarding climate change. However, he is now increasingly optimistic, regularly blogging about the rapid shift to renewables and in a recent article commented: “The transition to renewables will be mainly driven by mutually reinforcing megatrends in environmental law making, development of a disruptive family of insurgent energy technologies and industries, and contemporaneous decline of incumbency industries in the face of ageing problems.”
To stimulate corporate interest in renewables RE100 was launched by the Climate Group and CDP in 2014, and 37 companies had signed up by October 2015. By signing up to RE100, companies make a global, public commitment to 100% renewable electricity. This certainly appears to have created momentum, as there are now over 80 corporations enlisted globally, including Diageo, British Land, Unilever, AstraZeneca and Aviva Insurance.
One of the RE100 is the UK's largest commercial property company, Land Securities, which achieved 100% electricity procured from renewable sources earlier this year. Caroline Hill, their Head of Sustainability, commented that: “There's a misconception that it must cost significantly more to move to a green tariff, our experience is that it was less than 1% extra. It’s really quite a simple thing to do and would have an enormous impact if all corporates followed suit”. Looking forward, now that Land Securities has achieved its 100%, the company is focusing on ongoing energy management and onsite generation to reduce grid dependence—for example, covering roofs of selected shopping centres with PV as test cases.
Whole towns and cities are taking part in the renewables revolution, including some you might not expect. Big cities such as Seoul and Sydney have employed Allan Jones, who is now Chair of the International Energy Advisory Council, to help them transition to a low carbon future. He made his name in Woking, implementing a comprehensive decentralised energy system, which between 1992 and 2004, led to a spectacular saving of 49% in energy consumption and CO2 emissions reduction of 77% across the town.
This programme was clearly innovative, and inspired by its example, Sydney committed to a 100% renewables target by 2030. As Jones comments: “It's extremely important, from a technical point of view, to have a 100% renewable energy policy first so that you do the correct calculations, because you're replacing the fossil fuel grid. You cannot do that with a random selection of solar, wind or other technologies”.
As Jones indicates, renewables aren’t just solar and wind. The plan for Sydney is to have 70% of their power coming from combined heat, power and cooling ‘trigeneration’ using biomass-fuelled generators. Part of the plan is to use only local renewable energy, in order to avoid transmission losses and storm damage risk that accompanies overhead electricity lines.
Whilst there is considerable opportunity for massive solar arrays and wind farms, renewables don’t have to be big. As Mike Barry, Head of Sustainability at M&S, another member of RE100, comments: “Small-scale community energy offers distinct advantages over big energy. It’s proven and deployable now but above all it’s local, relevant and engaging.” M&S has put their money where their mouth is, and is now into their second year of a community energy competition.
He continues; “This is not to say that ‘big’ energy (whether nuclear, gas or offshore wind) is not an important part of the future energy system but just as they are being complemented by a technology revolution (storage, smart grid/meter etc.) so we need a community revolution too, where clean energy becomes more transparent, democratic and beneficial for everyone.”
It's not only the big businesses that are reaping the benefits, but also small organisations such as EMS, a family-run sheet metal fabricator based in Bury St Edmunds, UK,? “We’ve been working through the Suffolk County Council Green Clusters programme – and this has opened my eyes to what is possible for a small business. We had initially dismissed solar, but a strong business case was developed, accounting for grants, subsidies, and other financial support, which has given us the confidence to invest,” commented EMS's MD, Julian Long.
The revolution is happening, and it’s renewable.