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£8 billion paid in taxes:
£3bn in VAT
£2bn in climate levies
£2bn in income taxes and NICs
£1bn in corporate taxes
Over 700,000 jobs supported across the UK
£27 billion in gross value added
£97 billion generated in economic activity
through the supply chain
£12bn invested by the UK energy sector
68% emission
reduction in the
power sector since
2010
59% of power generated
from low carbon sources
£900m spent by the sector in 2020
to support vulnerable customers
through social schemes, and
millions extra in payment holidays
in response to the pandemic
Energy and the UK Economy
Contribution to the Economy
Energy and the UK economy I 2020
spent by the sector in 2020
Contribution to the Economy
Over
700,000 jobs supported across the UK
• £27 billion in gross value added
• £97 billion generated in economic activity through the supply chain
• £12bn invested by the UK energy sector
£900m
to support vulnerable customers through social schemes, and millions extra in payment holidays in response to the pandemic
59% of power generated
from low carbon sources £8 billion paid in taxes:
• £3bn in VAT
• £2bn in climate levies
• £2bn in income taxes and NICs
• £1bn in corporate taxes
68%emission reduction in the power sector since 2010
12 months in the energy sector I 2020-21
AugustSix million people are reported to fall behind on bills due to COVID-19 (Citizen Advice).
October Green Homes Grant scheme is launched to support energy efficiency improvements especially in low income homes.
NovemberThe Government publishes its 10 Point Plan which outlines ambition to mobilise £12bn in low carbon transition.
DecemberThe CCC publishes the 6th Carbon Budget, recommending a 78% reduction in GHG emissions by 2035 which is legislated by the Government in April 2021.
Government publishes its long awaited Energy White Paper, outlining how it will put affordability at the heart of the UK’s transition away from fossil fuels and announcing the launch of the UK ETS.
JanuaryThe Trade and Cooperation Agreement between the UK and the EU comes into force and GB moves to explicit allocation of capacity on the electricity interconnectors between GB and the EU until new arrangements are agreed.
MarchThe Green Homes Grant scheme is scrapped by the Government after six months.
AprilGB’s electricity is the greenest ever as carbon intensity falls below 40 gCO2/kWh for a period for the first time.
MayThe first UK ETS auction takes place and clears at £44 per allowance, gravitating towards the EU ETS price at the time.
JuneGas prices hit record levels amid supply pressures, strong global demand after a colder than average winter and easing of Covid lockdown measures.
JulyEnergy suppliers make additional commitments to support vulnerable customers worried about paying bills in Winter 2021/22.
AugustThe Government’s Hydrogen strategy is published providing vision for producing hydrogen in low carbon ways and outlining potential end uses.
2021
2020
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£8 billion paid in taxes:
£3bn in VAT
£2bn in climate levies
£2bn in income taxes and NICs
£1bn in corporate taxes
Over 700,000 jobs supported across the UK
£27 billion in gross value added
£97 billion generated in economic activity
through the supply chain
£12bn invested by the UK energy sector
68% emission
reduction in the
power sector since
2010
59% of power generated
from low carbon sources
£900m spent by the sector in 2020
to support vulnerable customers
through social schemes, and
millions extra in payment holidays
in response to the pandemic
Energy and the UK Economy
Contribution to the Economy
Energy and the economy
That is equivalent to 1.4% of UK GVA and 5.4% of total UK intermediary consumption1.
Looking ahead: Investing to meet net zero
A significant amount of additional funding is required to meet these targets:
1ONS, intermediary consumption is for 2019 but is inflated to 2020 prices. 2See the CCC and National Grid’s FES series for various scenarios.
£12bn invested in the gas and power sector in 2020
£15bn additional investment needed each year to 2050, to reach net zero in power
The UK’s power demand is expected to at least double by 2050 2.
Low carbon generation therefore needs to quadruple by then.
£27 billion in gross value added
+ £97 billion
in consumption through the supply chain to the UK economy.
The energy sector contributes
to the UK economy
Source: ONS
Source: ONS
Source: The CCC
x2 H2x4
Clyde Wind Farm, Copyright: SSE
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£8 billion paid in taxes:
£3bn in VAT
£2bn in climate levies
£2bn in income taxes and NICs
£1bn in corporate taxes
Over 700,000 jobs supported across the UK
£27 billion in gross value added
£97 billion generated in economic activity
through the supply chain
£12bn invested by the UK energy sector
68% emission
reduction in the
power sector since
2010
59% of power generated
from low carbon sources
£900m spent by the sector in 2020
to support vulnerable customers
through social schemes, and
millions extra in payment holidays
in response to the pandemic
Energy and the UK Economy
Contribution to the Economy
6,000
14,000
Source: ONS, figures do not sum to 146,000 due to rounding. Direct employment only.
19,000Scotland
10,000North East
8,000Yorkshire and Humber
17,000
East Midlands
6,000East
23,000South EastSouth West
Wales14,000
West Midlands
16,000North West
2,000Northern Ireland
10,000London
Employment in energy I 2020
Looking ahead: A net zero workforceTo support decarbonisation and further electrification while replacing aging workforce, 400,000 roles will need to be filled by 2050 in the wider energy sector.
46,000 people work in low carbon electricity and bioenergy
The sector employs over 700,000 people
directly and indirectly. That's 1 in 49 UK jobs.
Looking aheadTo support decarbonisation and further
electrification while replacing aging
workforce, 400,000 roles will need to be
filled by 2050 in the wider energy sector.
260,000 will be entirely new roles
The sector
employed
146,000 people
directly in 2020
46,000 people
work in low
carbon electricity
and bioenergy
Employment in energy in 2020
400,000 roles need to filled by 2050
The sector employed
146,000 people directly in 2020
Source: National Grid
Source: ONS
400,000 roles need to filled by 2050
260,000 will be entirely new roles
700,000 energy sector jobs
The sector employs
over 700,000 people directly and indirectly.
That’s 1 in 48 UK jobs.
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£8 billion paid in taxes:
£3bn in VAT
£2bn in climate levies
£2bn in income taxes and NICs
£1bn in corporate taxes
Over 700,000 jobs supported across the UK
£27 billion in gross value added
£97 billion generated in economic activity
through the supply chain
£12bn invested by the UK energy sector
68% emission
reduction in the
power sector since
2010
59% of power generated
from low carbon sources
£900m spent by the sector in 2020
to support vulnerable customers
through social schemes, and
millions extra in payment holidays
in response to the pandemic
Energy and the UK Economy
Contribution to the Economy
Diversity and inclusion within the energy sectorThe sector continues to promote D&I to attract all the talent we need to deliver on our net zero mission.
In 2021, Energy UK together with Ofgem were the first organisations from the energy sector to partner with BBC’s ‘50:50 The Equality Project’, which aims to improve gender representation in the workplace.
There is still work to be done as women and minority ethnicities are underrepresented within the sector.
Looking aheadEnergy UK continues to promote opportunities for people from all backgrounds over the coming years through initiatives such as:
• The Equality & Diversity Forum
• The ‘50:50 The Equality Project’
• Pride in Energy
• The Young Energy Professionals
• The Diversity in Energy Speakers Directory
0.0%
0.5%
1.0%
1.5%
2.0%
Asian Indian Black White% of ethnicity's workforce working in energy and water% of UK workforce working in energy and water
Ethnicity is overrepresented
Ethnicity is underrepresented
Source: ONS
The share of workforce from different ethnicities working in energy and water in 2018
Source: ONSAround one in five people (28%) working in power and gas were women in 2020.
1 in 5
In 2019, women accounted for only:
15% of 42,000 engineering and technology undergraduates
8% of allSTEM apprentices
22%of 37,000 A level physics students
Source: National GridSource: ONS
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£8 billion paid in taxes:
£3bn in VAT
£2bn in climate levies
£2bn in income taxes and NICs
£1bn in corporate taxes
Over 700,000 jobs supported across the UK
£27 billion in gross value added
£97 billion generated in economic activity
through the supply chain
£12bn invested by the UK energy sector
68% emission
reduction in the
power sector since
2010
59% of power generated
from low carbon sources
£900m spent by the sector in 2020
to support vulnerable customers
through social schemes, and
millions extra in payment holidays
in response to the pandemic
Energy and the UK Economy
Contribution to the Economy
Powering the UK I 2020
A record-breaking 43% of UK power generation came from renewable sources in 2020, and 59% came from low carbon.
The success of the power sector must be replicated in transport and heat, where progress is lacking. Emissions reductions in transport caused by Covid measures are not permanent.
Looking aheadTo ensure we build a massive low carbon power sector we need to ensure our markets incentivise investment at scale.
0
50
100
150
200
250
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
2016
2018
2020
MtC
O2e
Power stations TransportResidential Business & Industry
Source: BEIS
Greenhouse Gas emissions of selected sectors, 1990-2020
Source: BEIS
Source: BEIS
Renewables43%
Natural gas36%
Nuclear16%
Other5%
Powering the UK in 2020
Looking ahead
A record-breaking 43% of UK power generationcame from renewable sources in 2020, and 59%
came from low carbon.
To meet the expected doubling of power
demand in a low carbon way, the current
delivery mechanisms must be kept in place.
The power sector has decreased its emissions by
68% in the last decade, significantly more than any
other sector.
For the first time ever in 2020
renewable generation outstrippedfossil fuel generation for the annual
power generation.
UK power
generation
mix in 2020
Renewables generated more power
than fossil fuels for 203 days of the
year.
The success of the power sector must be
replicated in transport and heat, where progressis lacking. Emissions reductions in transport
caused by Covid measures are not permanent.
Source: BEIS
Source: BEIS
Source: BEIS
Source: BEIS
Greenhouse Gas emissions of selected sectors, 1990-2020
Source: BEIS
UK power generation mix in 2020
Other 5%
Renewables 43%
Natural Gas 36%
Nuclear 16%
The power sector has decreased its emissions
by 68% in the last decade, significantly more than any other sector. Source: BEIS
For the first time ever in 2020 renewable generation outstripped fossil fuel generation for the annual power generation.
Renewables generated more power than fossil fuels for 203 days of the year.
Source: BEIS and BMRS
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Transport I 2020
Number of public charging devices installed in the UK increased from 17,000 to 21,000 in 2020, including 4,000 rapid charging devices.
This is 50 public charging devices per 1,000 electric vehicles.
Source: ZapMap and DfT 4,570 12,464
3,142 788
SlowFast
RapidUltra-rapid
Number of installed public charging devices in the UK, as of 202021,000
installed
There were approximately 424,000 plug-in vehicles as of 2020, of which 194,000 were battery electric.
Looking aheadA balanced approach that combines incentives and regulation is needed to meet the target of all new car sales to be fully electric by 2035.
There could be 10 million EVs on the UK roads by 2030. To ensure that consumers can charge theirEVs whenever and wherever needed, the number of public rapid chargers needs to increase significantly.
Source: ZapMap
Source: SMMT and DfT
Battery electric vehicles accounted for 7% of new car sales in 2020.
0
100,000
200,000
300,000
400,000
500,000selcihev fo rebmu
N
Battery Electric Plug-in Hybrid Electric
Cumulative number of electric vehicles registered in the UK, by year
Source: DfT
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9
Heat and buildings I 2020
Source: BEIS
Looking ahead: Heating our homesAcceleration of heat pump installations is needed to reach the 2028 government target of 600,000 units installed per year.
In addition, the Hydrogen Strategy is anticipating that nearly 70,000 homes could be using hydrogen as part of their heating solution by 2030. Source: BEIS, The CCC, EHPA
600,000
400,000
200,000
heat
pum
ps in
stal
lled
pe
r ye
ar
Looking ahead: Energy efficiencyA comprehensive package of regulation, incentives and financial support is promptly needed to decarbonise our homes by 2050.
This is likely to increase without lockdown measures in place. Smart meters are vital for keeping bills down while transitioning to a more flexible energy system.
Energy suppliers installed 3.2 million smart meters in 2020, meaning that 42% of all meters across all premises have smart capabilities.
Energy efficiency of homes
324,000 energy efficiency measures were installed in 2020 under the ECO scheme, including 129,000 insulation measures.
However, this is significantly below the level that is needed to reach the Government ambition of having all homes rated EPC C or above by 2035.
Ambition by 2028
27,000
- 100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
2020 2025 2030 2020 2025 2030 2020 2025 2030
Lofts insulated Cavity walls insulated Solid walls insulated
dellatsni serusaeM
Home insulations installed in 2020 versus annual 2025 and 2030 targets in CCC’s pathway
Source: The CCC
Annual rate of installations between
2016 and 2020
9
10
Providing excellent customer service and protecting the vulnerable
Source: Ofgem
Source: BEIS
These commitments build on the industry’s voluntary Vulnerability Commitment that launched in January 2021.
Warm Home
Discount
£351m
Energy Company Obligation
£546m
In 202121 suppliers signed up to new commitments to support vulnerable customers over the next winter:
increase awareness of the help available and make communication easier
help ensure bill accuracy
step up smart meter installations for prepayment customers
6 million customers switched energy supplier in 2020.
Source: Ofgem
Source: Ofgem
Source: Energy UK
In 2020
Three quarters of households were satisfied with their energy supplier.
Complaints were down 23% compared to 2019.
Nearly £900m was spent on supporting vulnerable customers via rebates and energy efficiency measures.
The 324,000 ECO measures installed in 2020 will save £2.2bn on customers’ bills over the measures’ lifetime.
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Low power demand during lockdowns
Excess renewable generation at times
Prices were pushed to the negative+
This impacted power prices
Due to the lockdowns in 2020, power demand was less predictable which made balancing the power grid more challenging.
COVID-19 and the energy sector
This resulted in greater number of negative power price periods but also some sudden price hikes as the market operated as intended to ensure that the system remained in balance and avoided power cuts.
Lockdown measures had a noticeable impact on power demand.
Businesses shut down, people worked from homes and travelled less.
Power consumption was down 5% compared to 2019.
Although consumption in homes was up by 4%.
Hours of negative power imbalance prices, by year
The energy sector responded to customers’ hardships
0
50
100
150
200
250
2015 2016 2017 2018 2019 2020Source: BMRS
Energy suppliers provided hundreds of millions of pounds in payment holidays and other support.
Consumer trust in energy suppliers increased by eight percentage points during the pandemic.
Source:Ofgem
A million customers per month were on repayment plans or payment holidays.
Source:Ofgem Source:Which?
Source: BEIS
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