As we take our first steps into 2021, we look back at the biggest developments in the UK energy markets in 2020, setting us up for the significant year ahead.
As 2019 turned into 2020, we were still waiting for the Energy White Paper (EWP), a document which had been delayed from the previous summer. However, other policy announcements got the ball rolling, starting in March with BEIS consulting on allowing onshore wind and solar in the next Contracts for Difference round, as well as setting out measures to protect customers during the COVID-19 pandemic. In October, at the Conservative Party conference, the Prime Minister set out plans to ‘Build Back Greener’ from the COVID-19 pandemic, confirming the 2019 Conservative manifesto commitment to increase the offshore wind capacity target to 40GW by 2030. Additionally, he announced a new target of 1GW of floating offshore wind by 2030.
The next major announcement was the Prime Minister’s 10 Point Plan for a Green Industrial Revolution, released on 18 November. In it, the PM announced targets to remove 10Mt of carbon dioxide a year by 2030 through carbon capture, to aim to generate 5GW of low carbon hydrogen production capacity by 2030, as well as 600,000 heat pump installations every year by 2028.
The policy releases did not stop after that. The week after, the government published the National Infrastructure Strategy, setting out its plans for infrastructure investment, covering issues such as energy market reform, funding models and regulatory frameworks. Soon after that, the government announced a new interim greenhouse gas emissions reduction target of 68% for 2030, on 1990 levels. The Climate Change Committee then published its advice for the sixth carbon budget (2033-37), including that emissions must fall 78% by 2035, compared to 1990 levels.
All the while, rumours around the release date of the EWP swirled, with some commentary suggesting it was waiting on the Brexit agreement. On 14 December, the EWP arrived, promising a very active 2021 for the sector, with consultations covering areas such as autoswitching, third party regulation, affordability and fairness, and transparency. In the same week, the Treasury published its Initial Analysis of Green Transition Review. This was all capped off by the post-Brexit trade agreement, published on 24 December, and setting out arrangements for interconnectors, trading and the UK Emissions Trading Scheme.
With another national lockdown announced this week, the pandemic is certain to remain top of the policy agenda in 2021. This year would have been busy for BEIS even without the pandemic – the government has put an awful lot on its plate for this year, with a raft of consultations and calls for evidence to take place soon, all of which we will cover in the Daily Bulletin and Energy Spectrum.