Table of Contents
Overview
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- What you need to know
- Covered in this Report
Executive Summary
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- The market
- Renewables' share of total electricity generation nears 30% in 2017
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- Figure 1: UK renewable penetration of electricity generation, 2013-17
- UK renewable energy installed capacity dominated by wind
- The UK is the world leader in offshore wind
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- Figure 2: UK renewable energy market shares, by installed capacity, 2013 and 2018
- Revenue growth in UK renewable energy sector slows in 2017 due to a drastic decline in solar PV sector
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- Figure 3: UK turnover of renewable energy industry, 2013-17
- Renewable energy generation to show continued growth over the next 10 years
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- Figure 4: Forecast renewable electricity generation, 2017-35
- Government urged to implement more supportive policy framework to secure future investment in low carbon sector
- What we think
Issues and Insights
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- Government policy changes dampen UK clean energy investment
- The facts
- The implications
- Offshore wind costs are falling fast, driven by bigger turbines, increased competition and a growing UK supply chain
- The facts
- The implications
The Market – What You Need to Know
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- Renewables’ share of electricity generation reaches nearly 30%
- Investment in UK low carbon sector has stalled over last two years
- Government urged to implement more supportive policy framework to secure future investment on low carbon sector
- Some investors are starting to see opportunities in subsidy-free and storage projects
UK Electricity Generation
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- Overview
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- Figure 5: Analysis of electricity generation the UK, by type of fuel used, 2013-17
- Figure 6: Proportional importance of fuel source in UK electricity generation, 2013 and 2017
- UK renewables generation
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- Figure 7: Renewable electricity generation in the UK, 2013-17
- Figure 8: UK renewable energy market shares, by installed capacity, 2013 and 2018
Wind Generation
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- Overview
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- Figure 9: UK onshore and offshore wind energy generation capacity, MW and %, 2013 and 2018
- Onshore wind
- Early closure of RO for onshore wind
- Record number of onshore wind farms built in 2017 as developers rush to meet subsidies deadline
- Currently no government support available to onshore wind projects
- But cost of onshore wind is falling fast
- Future potential for onshore wind
- Offshore wind
- 33 offshore wind farms operational in UK
- The UK is the world leader in offshore wind
- Offshore wind sees significant cost reductions
- Result of second CfD auction reveals further cost reductions for offshore wind
- Turbine sizes are increasing, enabling developers to slash costs of wind farms
- Wind generation capacity and generation
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- Figure 10: UK wind energy capacity, 2013-18
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- Figure 11: UK wind energy generation, 2013-18
- Figure 12: UK wind energy capacity, by country 2014-18
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- Figure 13: UK wind generation development pipeline, as of July 2018
Shoreline Wave/Tidal Generation
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- The Crown Estate licences wave and tidal sites to help unlock opportunities
- Hendry review concludes that tidal lagoons can play a cost effective role in the UK’s energy mix
- Swansea Bay tidal lagoon project gets thrown out by government despite backing from Hendry review
- Just 18MW of wave energy capacity installed to date
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- Figure 14: UK wave energy capacity and generation, 2013-18
- Figure 15: UK wave and tidal capacity in development pipeline, as of July 2018
Photovoltaic Generation
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- Overview
- Ground-mounted sector moves into post-subsidy phase
- Emergence of PPAs present growth opportunities for ground-mounted solar PV installations
- 8.3 GW installed capacity across 1,122 solar farms operational
- UK sees dramatic fall in solar PV installs in 2016 and 2017 following government policy change
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- Figure 16: Photovoltaic installations in the UK, 2011-18
- Figure 17: Photovoltaic installations in the UK, 2010-17
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- Figure 18: Photovoltaic installations in the UK, by capacity of installation, 2012-18
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- Figure 19: Photovoltaic installations in the UK, by accreditation scheme, 2012-18
- Figure 20: Photovoltaic installed capacity in the UK, by size, as of July 2018
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- Figure 21: UK PV development pipeline, as of August 2018
Hydro Generation
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- Figure 22: UK hydro energy capacity, 2013-18
- Figure 23: UK hydro electricity generation, 2013-18
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- Figure 24: UK hydro electricity development pipeline, as of August 2018
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Bioenergy Electricity Generation
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- Recent government policy changes affecting the bioenergy sector
- Clean Growth Strategy highlights bioenergy’s potential
- Landfill gas
- Sewage sludge digestion
- Energy from waste
- Advanced conversion technology (ACT)
- Animal biomass
- Anaerobic digestions
- Co-firing and biomass
- UK government-commissioned report positive on biomass
- Bioenergy installed capacity and generation
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- Figure 25: UK bioenergy installed capacity, 2013-18
- Figure 26: UK bioenergy and waste generation energy capacity, as of end of March 2018
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- Figure 27: UK bioenergy generation, 2013-18
- Figure 28: UK bioenergy capacity, by country, 2018
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- Figure 29: UK bioenergy development pipeline, as of July 2018
Market Forecast
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- Decarbonisation of UK energy system
- Growth in decentralised and renewable electricity generation will increase the complexity of operating a secure and cost-effective energy system
- Investment in UK low carbon sector has stalled in last two year, highlighting importance of more supportive government policies
- Some investors are starting to see opportunities in subsidy-free projects, storage projects and newer technologies
- Energy storage to play key role in transition to clean electricity supply system
- BEIS and Ofgem unveil plans for major upgrade of the UK’s energy systems, including the removal of barriers to storage
- Government unveils £246 million battery investment strategy in July 2017
- Renewables capacity development pipeline
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- Figure 30: Renewable energy projects in pipeline, by technology, as of August 2018
- Figure 31: Forecast renewable electricity generation, 2017-35
Future Energy Mix and Demand
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- Future energy demand under National Grid’s Future Energy Scenarios
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- Figure 32: Annual power demand in Great Britain, 2017-50
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- Figure 33: Annual power demand in Great Britain, 2017-50
- Future potential energy mix
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- Figure 34: Forecast power generation installed capacity under “community renewables” scenario, by source, 2017-50
- Figure 35: Future potential energy mix in Community Renewables Scenario in 2040
- Figure 36: Forecast power generation installed capacity under “two degrees” scenario, by source, 2017-50
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- Figure 37: Future potential energy mix in two degrees scenario in 2040
- Figure 38: Forecast power generation installed capacity under “steady Progression” scenario, by source, 2017-50
- Figure 39: Future potential energy mix in steady progression scenario in 2040
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- Figure 40: Forecast power generation installed capacity under “consumer evolution” scenario, by source, 2017-50
- Figure 41: Future potential energy mix in consumer evolution scenario in 2040
Energy Policy and Legislative Environment
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- UK committed to reducing carbon emissions by 80% below 1990 levels by 2050
- UK currently on track to miss emission reduction targets between 2023 and 2032
- Policies to decarbonise electricity
- Levy Control Framework
- Renewables Obligation
- Feed-in Tariffs
- Carbon Price Floor
- Contracts for Difference
- Capacity Market
- The Renewable Heat Incentive
Companies and Brands – What You Need to Know
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- Revenue growth in UK renewable energy sector slows in 2017 due to a drastic decline in solar PV sector
- UK offshore wind sector starts to attract a broadening investor pool
- Onshore wind industry currently restricted due to lack of government-backed routes to market
- BP invests in Lightsource to drive global solar expansion
- Biogen acquires Tamar Energy, creating one of the largest independent AD operators in the UK
Industry Structure
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- Overview
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- Figure 42: UK turnover of renewable energy industry, 2013-17
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- Figure 43: Employment in key renewable energy sectors, 2016-17
- Abrupt government policy changes result in many companies exiting UK solar PV sector
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- Figure 44: Employment and number of companies active across UK solar PV supply chain, 2012-17
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- Figure 45: UK solar PV sector turnover, 2012-17
- Offshore wind industry continues to expand at pace
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- Figure 46: UK offshore wind sector turnover, 2012-17
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- Figure 47: Employment and number of companies active across UK offshore wind supply chain, 2012-17
- Onshore wind industry set to be restricted in the short term due to lack of government-backed routes to market
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- Figure 48: UK onshore wind sector turnover, 2012-17
- Figure 49: Employment and number of companies active across UK onshore wind supply chain, 2012-17
Company Profiles
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- Biogen (UK)
- Biogen (UK) purchased by Ancala Bioenergy in 2017
- Biogen acquires Tamar Energy, creating one of the largest independent AD operators in the UK
- Company performance
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- Figure 50: Financial analysis of Biogen (UK), 2012-16
- First Hydro Company
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- Figure 51: Financial analysis of First Hydro Company, 2013-17
- Lightsource Renewable Energy Investment
- BP invests in Lightsource to drive global expansion
- Strategy
- Recent UK company developments
- Financial performance
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- Figure 52: Lightsource Renewable Energy Investments, 2016-17
- ScottishPower Renewables
- Financial performance
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- Figure 53: Financial analysis of ScottishPower Renewables, 2013-17
- SSE
- SSE and Npower in talks to merge retail businesses
- Renewable generation accounts for 28% of electricity output in 2017/18
- Company strategy
- Financial performance
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- Figure 54: Financial analysis of SSE, 2014-18
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- Figure 55: SSE revenue segmental analysis, 2018
- Vattenfall Wind Power
- Company outlook and strategy
- Financial performance
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- Figure 56: Financial analysis of Vattenfall Wind Power, 2013-17
- Vestas-Celtic Wind Technology
- Recent company activity
- Company review and outlook
- Financial performance
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- Figure 57: Financial analysis of Vestas-Celtic Wind Technology, 2013-17
Appendix – Data Sources, Abbreviations and Supporting Information
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- Abbreviations
- Methodology
Further Sources and Contacts
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- Trade associations
- The Anaerobic Digestion and Biogas Association
- Energy UK
- British Hydropower Association
- British Photovoltaic Association
- Energy Networks Association
- Energy Industries Council
- Environmental Services Association
- European Solar Thermal Industry Federation
- European Wind Energy Association
- Micropower Council
- Office of Gas and Electricity Markets (Ofgem)
- Office of Gas and Electricity Markets - Scotland (Ofgem Scotland)
- Renewable Energy Association
- SolarPower Europe
- Solar Trade Association
- Trade magazines
- Energy Now
- Real Power
- Renewable Energy Focus
- Renewable Energy Installer
- Resource
- Solar Business Focus
- Solar UK
- Solar International
- Wind Energy Network
- Wind Power Monthly
- Trade events
- All-Energy Exhibition & Conference Aberdeen
- edie live 2019
- Future Resource Expo
- Offshore Europe
- Solar & Storage Live
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