BEIS Energy White Paper “Powering of our Net Zero Future”

Below is a brief non-comprehensive summary of the 156 pages White Paper put together by Ian Shinwell. Please contact Ian if you require more information at ian.shinwell@energy-potential.com.

The BEIS Energy White paper consists of a wide range of measures backing up Boris Johnson’s “10-point plan” for achieving net zero carbon by 2050.  The UK accounts for <1% of global emissions and has reduced emissions much faster than other G20 countries since 2000 and aims to remain at the forefront of the net zero target within an affordable green recovery from Covid 19.  There is a general target to deliver mainly decarbonised power by the 2030s.

A number of specific measures and aspirations are included and outlined below.

1. UK ETS cap and trade scheme to be developed from January 2021[1]  A cap on businesses’ greenhouse gas emissions will diminish over time and initially apply to only energy intensive industries, electricity generation and aviation.  The target from this and other measures is to cut emissions from industry, transport and buildings by 230 tonnes p.a. over the next 10 years
2. Support for the fuel poor worth at least £6.7 billion over the next six years, achieved through ECO[2] (extended to 2026), WHD[3] (expanded up to 2026) together worth £4.7b and £400 bill credits grants for those on Universal Credit and the Green Homes Grant for low-income households
3. Installation of electric heat pumps[4] to grow from 30,000 to 600,000 p.a. by 2038.
4. Pledges to invest £1b in 4 low carbon CCUS[5] regional clusters by 2030 and one net-zero by 2040 aiming to capture 10MtCO2 p.a. by 2030.  Several regions are competing for this.  BP, Eni, Equinor, Shell and Total have signed up to spearhead the development of the Net-Zero Teesside CCUS.  Hydrogen expected to feature heavily in this initiative. Jobs and export opportunities will result.   The aim is for 2 clusters by the mid-2020s and a further 2 by 2030)
5. Drax, Equinor and National Grid planning world's first zero-carbon industrial hub in Humber region by 2040.   2 innovation funds with £140m available created October.
6. All measures intended to create 220,000 jobs in the next decade across infrastructure, hydrogen, and carbon capture.
7. Government commitments reiterated to establish 40GW of offshore wind by 2030 (a fourfold increase on current level) in combination with other non-intermittent generation sources.
8. Will develop a Hydrogen strategy in 2021 building on the £240m Net -Zero Hydrogen Fund with a target of 5GW of low-carbon hydrogen production capacity by 2030. 
9. All new heating systems installed by the mid-2030s to be low carbon.
10. Government to work with North Sea O&G producers to make UK continental shelf a net zero basin by 2050.  Includes protection for staff and communities and will create jobs
11. Government is exploring funding options for achieving FID for at least one nuclear project by end of this Parliament.  NB the government is discussing Sizewell C nuclear project with EDF
12. The government has established the Jetzero Council to promote new technologies to enable net zero emissions for transport.  Competitions for £20m funding for designing clean maritime technology and £14m for sustainable aviation will be established.  The shift to zero emission vehicles is expected to provide 40k jobs
13. Building world-leading digital infrastructure for our energy system based on strategy to be increasingly less dependent on fossil fuels
14. Create a fair deal for consumers/fuel poor balancing investment against bill impacts.  Consult by March 2021 on measures including promoting competition (reform/regulation of switch mechanisms and third parties i.e., brokers and comparison websites).  Consulting on ending gas grid connections to new homes from 2025
15. Promotion of smart tariffs designed to support low carbon technology e.g. Electric Vehicles and heat pumps. The government will publish a smart systems plan in 2021.   This is a response to the expected huge increase in end user demand for electricity as it replaces fossil fuels
16. Establishing the Future Homes Standard to ensure all newbuild homes are zero carbon ready.  Consulting on regulatory measures to improve the energy performance of homes and mortgage lender support in making these improvements
17. Requiring that all rented non-domestic buildings will be EPC[6] Band B by 2030 and as many domestic premises as possible to achieve EPC Band C by 2035

[1] UK leaves EU and EUETS

[2] Energy Company Obligation

[3] Warmer Homes Discount

[4] These extract heat from air, ground or water and deliver it to central heating systems & replace fossil fuel-based heating

[5] Carbon Capture Usage and Storage

[6] Energy Performance Certificate