‘Phantom’ Power Projects Are Holding Back The UK’s Energy Security – Centrica Report
The title of this post, is the same as that of this press release from Centrica.
These are the three bullet points.
- New report shows queue for new energy projects is blocked by developers that may not even have land rights and haven’t applied for planning consents
- Estimated size of these power projects in the queue is 62GW, roughly one fifth of all power in the queue
- Centrica CEO argues such ‘phantom’ projects should have Construction Agreements terminated if developers miss key milestones – and urges Ofgem to give National Grid ESO the power to remove projects from the existing grid queue
This is the first two paragraphs.
A new independent report, commissioned by Centrica, has revealed the extent of the power projects holding back the UK’s energy security and creating risk around hitting net zero.
The report examined the UK’s existing queue for Transmission Entry Capacity (TEC) – the queue for connecting new projects to the transmission grid – and discovered that it is up to four times oversubscribed. Not only that, but this oversubscription has become significantly worse in the last few years.
The report found these three totals.
- There are currently 371GW of projects in the queue, enough to significantly improve the UK’s energy security.
- Around 114GW worth of projects have listed their connection date as before 2029.
- But around 62GW of these projects are only in the scoping phase and developers may not even have secured land rights or applied for planning consent.
This is both good and bad news!
Here Is The Good News!
Currently, the UK is using 37 GW of electricity, of which 32 GW are generated in the UK, 5 GW is being imported through interconnectors and around 6 GW are coming from renewables.
So this means that when we build all the 371 GW in the queue, we’ll have around eleven times the electricity we are using today.
Of the 114 GW of projects listed for connection before 2029, it looks like 62 GW won’t be delivered, as they haven’t secured land rights or applied for planning consent.
But that still means that as much as 52 GW could be delivered by 2029.
Even this reduced level of new projects still increases the amount of electricity that can be generated by nearly 150 %.
If I’m being ultra pessimistic, I would say that the average capacity factor of the extra capacity was 50 %, so we’d only be adding 26 GW, so the electricity, that can be generated would only rise by around 70 %.
I suspect all in the UK can live with these paltry increases.
Here Is The Bad News!
This is a paragraph from the report.
The report suggests that the oversubscribed queue, and longer wait for connections. has a damaging effect on the investments that could drive the UK’s energy transition and energy security.
Developers and investors will decamp to countries, where they be sure of getting a return on their time and money.
Think of having two supermarkets close to you live, where one is professional and one is chaotic. Where would you shop?
The congestion caused by phantom projects must be solved.
Ofgem’s Solution
This is the solution in the press release.
Ofgem is exploring rule changes (CMP376) to address queue issues and is expected to decide these before 10 November. These rule changes would grant the ESO the ability to remove projects from the queue if they miss key milestones. Ofgem is currently considering whether to apply this rule change to just new projects entering the queue, or whether the rule change should also be applied to projects already in the queue.
They can probably come up with a solution.
An Alternative Method From My Past
In 1969, I worked for ICI, where one of my jobs was building specialist instruments for chemical plants.
Most instruments, that were designed by the group I belonged to, included a chassis on which the components and electronics were mounted. So we had a workshop and about seven or eight staff at our disposal to build the chassis and the parts outside of our skills. As they were used by several groups in the building, where we were all based, the workshop was very busy and everything was delivered late.
Eventually, a manager decided to get a grip on the situation.
He insisted, that the workshop would not do what you wanted if your delivery date was as soon as possible, rather than a date agreed by both parties.
The results were amazing and everything was delivered on the agreed date.
With the renewable energy connection queue, I am sure, that if a procedure was developed, that only allowed fully-planned projects with an agreed completion date to enter the queue, then the problems of phantom projects would be solved.
It might also reduce the cost of developing these renewable projects.
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