Powering a secure and affordable transition: why resilience underpins growth
A strong economy depends on a strong energy system. As Britain pursues net-zero, maintaining security and value for money will be essential to increasing growth and public confidence.
As policymakers prepare for the upcoming Budget, the national conversation is rightly turning to our energy system, and how net-zero could deliver savings and growth.
Growth relies on a system that delivers electricity whenever it is needed at the lowest possible cost. The UK is a first mover in renewables, and a world leader in offshore wind. Renewables often provide the lowest-cost power; however, they can’t always generate when needed – sometimes for days at a time. That’s why firm power generation which can always be turned on (enduring dispatchable generation) remains essential to keep the country running.
The ambition for 95 per cent clean power by 2030 is admirable, and the Clean Power 2030 Action Plan is world class in setting out the steps toward a decarbonised grid. It confirms that around 35GW of dispatchable gas-fired generation will be needed to provide security of supply.
Emerging technologies will play an important role in the years ahead, but for now Britain’s strategic fleet of gas-fired dispatchable power remains the most cost-effective form of enduring dispatchable generation. The priority should be to maintain that fleet while emerging forms of capacity become cost-competitive.
For more than 30 years, InterGen has operated as an independent generator producing around five per cent of Britain’s peak electricity demand. Our gas-fired generation can be switched on and off to fill the gaps when demand rises or renewable output dips. Efficiently delivering this dispatchable enduring capacity supports growth and investment across the wider economy. InterGen invests in its part of Britain’s strategic fleet of firm power and will be ready to operate for years to come – providing dependable power as the economy grows and new generation technologies mature.
The Climate Change Committee notes that over 80 per cent of emissions cuts to 2030 must come from sectors beyond energy supply. It makes little sense to invest heavily in immature novel technologies when, as the National Energy System Operator confirms, they will run very infrequently. If the priority is the greatest carbon saving and the greatest economic return (affordability, reliability, and public confidence) we propose that the UK supports and leverages its existing strategic gas-fired assets, decarbonises where most cost-effective, and not spend bill-payers’ money on unproven technologies.
We must also reinforce the principles that make Britain a world leader in energy: stable, competitive markets that attract private investment and allow technology-neutral competition to deliver the best value for money.
Frequent redesigns and uncertainty over future market rules are making long-term investment decisions increasingly complex, threatening system reliability. Reforms should strengthen, not undermine, the conditions that keep efficient, well-run operators in the market.
A resilient energy system is the foundation of a thriving economy. Britain’s existing gas-fired generation is a strategic national asset, providing essential flexibility and security of supply. Protecting and making best use of this fleet through stable, competitive markets will deliver reliability and value for money for decades to come – without inhibiting decarbonisation.
Energy security and affordability are not competing objectives; they are the cornerstone of sustainable growth and decarbonisation.
To learn more about InterGen’s role in the UK’s energy transition, contact us at [email protected] or visit www.intergen.com/our-energy.
