issues for gb energy policy and the ipcc lecture to dti energy...
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Issues for GB Energy Policy
and the IPCC
Lecture to DTI Energy
Engineering [email protected]
23 October 2018
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Overview
• IPCC and targets
• What should a Government think about when it puts
in place a target?
• CCC assessment of GB energy policy relative to CC
Budgets
• GB energy policy: smart and flexible
• GB energy policy issues
• Whole System energy policy is essential
• Obvious differences between GB and Denmark
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The Globe
has to
reach net
zero CO2
emissions
by 2050 –
IPCC
Special
Report http://report.ipcc.ch/
sr15/pdf/sr15_spm_fi
g1.pdf
IPCC AR6
will be
2019-2021
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Reaching Net
Zero by 2050 is a
major challenge.
The Globe has to
‘step up’
immediately.http://report.ipcc.ch/sr15/pdf/sr15_spm_fi
g1.pdf
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There are multiple technological ways to meet GHG
reductions – models do not tend to take notice of whether
people will accept them or not http://www.ipcc.ch/report/sr15/
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Energy policy is just
one aspect of public
policy goals. Different
technological
pathways will lead to
different societal
trade-offs and
synergies. Decision-
makers have to think
in terms of overall
society good rather
than one ‘best’ energy
policy. This is an
example of
Sustainable
Development Goals
(SDGs). http://report.ipcc.ch/sr15/pdf/sr15_spm_fig4.pdf
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UK CCC Carbon Budgets via the 2008
CC Act (this is for 2 degrees)
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How is Britain doing ? https://www.theccc.org.uk/wp-
content/uploads/2018/06/CCC-2018-Progress-Report-to-Parliament.pdf
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CCC argues
for 4 basic
policy
messages:
Support simple low cost
options
End the chopping and
changing of policies
Commit to effective
regulation and enforcement
Act now
https://www.theccc.org.uk/wp-
content/uploads/2018/06/CCC-
2018-Progress-Report-to-
Parliament.pdf
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CCC also highlights the Policy Gap https://www.theccc.org.uk/wp-content/uploads/2018/06/CCC-2018-Progress-Report-to-Parliament.pdf
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http://projects.exeter.ac.uk/igov/wp-content/uploads/2018/10/Direction-setting-for-energy-system-transformation-
Matthew-Lockwood.pdf
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In many ways,
GB Government
has a clear
energy policy:
‘smart and
flexible’
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There is a shift towards distributed generation http://projects.exeter.ac.uk/igov/wp-content/uploads/2018/05/Lockwood-Innovation-and-govenance-in-the-GB-energy-system-
Karlsruhe.pdf
Year DG capacity (GW)
Peak demand (GW)
GB 2016 28 61
Germany 2015 89 86
California 2016 10 61
Rep. of Ireland 2017 1.9 5
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British direction-setting in practice http://projects.exeter.ac.uk/igov/wp-
content/uploads/2018/05/Lockwood-Innovation-and-govenance-in-the-GB-energy-system-Karlsruhe.pdf
• Strong backing for carbon pricing (EU
ETS, Carbon Price Support under
EMR)
• Support for renewables under pressure
from EU
• Mechanism reformed to allow support
for new nuclear (CfD FiT via EMR)
• Capacity Market (for CCGT)
• 2016: support rates for solar PV cut by
64-85% and onshore wind removed
from support framework; small scale
FiT about to go for solar
• CfD FiT now solely for offshore wind
and nuclear
• ‘Subsidy free’ renewables not yet
materialised
• Ineffective energy efficiency measures
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Direction-setting: case study of flexibilityhttp://projects.exeter.ac.uk/igov/wp-content/uploads/2018/05/Lockwood-Innovation-and-govenance-in-the-GB-energy-
system-Karlsruhe.pdf
• No agreed pathway for heat decarbonisation
• No targets for new flexibility resources (EVs,
grid-scale storage, DSM, heat pumps/storage)
• ‘…we think there is significant scope for these
and other system requirements to be addressed
through market-based approaches. In
particular, we see value in transparent and
integrated markets. We expect to see such
approaches used wherever it is most efficient to
do so.’ (BEIS/Ofgem 2016: 76-77)
• Policies in some areas (grants for EVs (just
cut), RHI support scheme for heat pumps)
defined by budgetary input not outcomes
• Plan but no detailed vision with timelines
• Government role is enabling or facilitating
change rather than delivering
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Is support for nuclear long-term & sustainable? http://projects.exeter.ac.uk/igov/wp-content/uploads/2018/05/Lockwood-Innovation-and-govenance-in-the-GB-energy-system-Karlsruhe.pdf
• System compatibility of nuclear and renewables (max. summer
demand ~36GW, renewable capacity 35.7GW in 2016)?
• Cost?
• Societal support?
0
10
20
30
40
50
60
70
80
90
100
%
On-shore wind Solar PV Nuclear
Source: BEIS Public Attitude Tracker
Percentage supporting technology
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Lots of activity around economic regulation – fits
market approach http://projects.exeter.ac.uk/igov/wp-content/uploads/2018/10/Direction-setting-
for-energy-system-transformation-Matthew-Lockwood.pdf
RIIO2 (inc.ED2)
Access and forward charging review
Half hourly settlement
Targeted Charging Review
Open Networks project (TDI, DSO…)
Smart Flexible Energy reforms (storage, DSR aggregation)
ESO reforms
Supplier hub consultation Unlocking the
capacity of electricity networks
Sandbox, Innovation Link, NIA/NIC etc.
Smart charging standards (AEV Act 2018)
NG System Needs and Product Strategy
NG Power Responsive
Next day switching
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…so ensuring coordination and consistency is
a huge task…, and does not happen http://projects.exeter.ac.uk/igov/wp-content/uploads/2018/10/Direction-setting-for-energy-system-transformation-Matthew-
Lockwood.pdf
RIIO2 (inc.ED2)
Access and forward charging review
Half hourly settlement
Targeted Charging Review
Open Networks project (TDI, DSO…)
Smart Flexible Energy reforms (storage, DSR aggregation)
ESO reforms
Supplier hub consultation
Unlocking the capacity of electricity networks
Sandbox, Innovation Link, NIA/NIC etc.
Smart charging standards (AEV Act 2018)
NG System Needs and Product Strategy
NG Power Responsive
Next day switching
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Clear vision of future system• Required functions, linked
to policy goals• Institutional arrangements
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Would be made easier if there is clarity and agreement
on where we are trying to get to http://projects.exeter.ac.uk/igov/wp-
content/uploads/2018/10/Direction-setting-for-energy-system-transformation-Matthew-Lockwood.pdf
RIIO2 (inc.ED2)
Access and forward charging review
Half hourly settlement
Targeted Charging Review
Open Networks project (TDI, DSO…)
Smart Flexible Energy reforms (storage, DSR aggregation)
ESO reforms
Supplier hub consultation Unlocking the
capacity of electricity networks
Sandbox, Innovation Link, NIA/NIC etc.
Smart charging standards (AEV Act 2018)
NG System Needs and Product Strategy
NG Power Responsive
Next day switching
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Example of an outcome without coordination
and coherence – solar pvhttp://projects.exeter.ac.uk/igov/wp-content/uploads/2018/10/Direction-setting-for-energy-system-transformation-
Matthew-Lockwood.pdf
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Differences between Denmark and UK Matthew Lockwood (2015) http://projects.exeter.ac.uk/igov/wp-content/uploads/2015/06/ML-Danish-model-of-
regulation1.pdf
• Geography is different
– Easier to be interconnected
– Well developed regional pool market design
• Different culture / history / resources
• Political and decision-making process much more
consensus - based
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IPCC issues (if have time) Jan C. Minx, et al (2017) Environmental Science and
Policy 77 (2017) 252-259, Learning about climate change solutions in the IPCC and beyond.
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Publications assessed versus proportion
in IPCC reports Jan C. Minx, et al (2017) Environmental Science and Policy 77 (2017) 252-259,
Learning about climate change solutions in the IPCC and beyond.
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References
• BEIS/Ofgem (2016) A Smart, Flexible Energy System: A call for evidence,
https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/
576367/Smart_Flexibility_Energy_-_Call_for_Evidence1.pdf
• BEIS/Ofgem (2017) Upgrading our Energy System: Smart Systems and Flexibility Plan,
https://www.ofgem.gov.uk/system/files/docs/2017/07/upgrading_our_energy_system_-
_smart_systems_and_flexibility_plan.pdf
• Digest of UK Energy Statistics (DUKES) (2017)
• Energy UK (2016) Pathways for the GB Electricity Sector to 2030 https://www.energy-
uk.org.uk/publication.html?task=file.download&id=5722
• Institute for Engineering and Technology (IET)/Energy Systems Catapult (2017) Future Power
System Architecture Project 2: Synthesis Report
https://www.theiet.org/sectors/energy/resources/fpsa/fpsa-future-system-challenges.cfm
• Regen (2017) Energy Storage: The next wave – Growth prospects and market outlook for energy
storage
• Regen (2018) Market insight series: Harnessing the electric revolution
• Matthew Lockwood (2015) http://projects.exeter.ac.uk/igov/wp-content/uploads/2015/06/ML-
Danish-model-of-regulation1.pdf
• Jan C. Minx, et al (2017) Environmental Science and Policy 77 (2017) 252-259, Learning about
climate change solutions in the IPCC and beyond.
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Annex
• IGov Governance Framework in process of being
updated
– http://projects.exeter.ac.uk/igov/
– Our 2016 fit-for-purpose governance framework
document: http://projects.exeter.ac.uk/igov/paper-gb-
energy-governance-for-innovation-sustainability-and-
affordability-2/
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Current GB Governance System – ‘value’ suits
‘old’ fossil-based – incumbency and inertia
are barriers to change
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IGov Fit-for-Purpose GB Energy Governance Framework http://projects.exeter.ac.uk/igov/wp-content/uploads/2017/10/SYS-Copenhagen-27-October-2017.pdf
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Overview Findings of IGov1 – 4 central dimensions
required for energy system transformation
Transfo
rmatio
n
Flexible, coordinated
operation & design
ReformingRegulation
Customer Focused
Transparent & legitimate
policymaking / institutions
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Customer Focused
• Customer wishes at center, and policies built around customer proposition
• Meaningful consent• Engagement• Trust, equity, legitimacy and
democracy• Tariffs, prices and bills• PSO
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Transparent & legitimate policymaking/institutions
• Coherent, legitimate , coordinated decision making (including incorporating CCC Advice via institutions)
• Less BEIS delegation, more SoS Direction (ie IISO v Ofgem)
• Consensus Building Body (or a body which coordinates intellectual, political and social debate)
• Market Monitor and Data Body
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Flexible, coordinated operation & design
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Flexible, coordinated operation & design
• Service should be able to sell to whom they want (national or local)
• Customer should be able to buy from whom they want (national or local)
• IISO has responsibility to develop / balance infrastructure and markets to meet CCC targets, and to coordinate and integrate across heat and electricity
• DSP are coordinators, balancers and integrators of local areas and markets, regulated through PBR
• Bottom-up / Area system optimisation with TO increasingly balancer
• IISO DSP coordination• Governance dimensions all need to encourage this, not
least for cost benefits
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Reforming Regulation
• New Ofgem duty to meet CCC carbon budgets; stripped back to economic regulator
• More performance based regulation (ie more output focused)
• DNO to DSP; SO to IISO• Restructured RIIO2, enabling decarb of
electricity by 2030 and progressive ISSO• Closer link between network operation,
market design, data and public policy goals• Access to, and transparency of, data
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Distribution Service Providers should be at the
heart of regulatory reform and electricity
decarbonisation: ‘active’ ; RIIO way behind
DNO DSO DSP
1 2 3 4 5 6 7 8 9 1 0