Renewable energy will account for more than half of the UK’s electricity generation by 2025, according to a new report from Bloomberg New Energy Finance (BNEF), driven in part by the falling cost of generating energy from wind and solar.
Highlighting the significance of BNEF’s findings, Dr Nina Skorupska, chief executive of the Renewable Energy Association, said: “The study shows that wind and solar power are now the cheapest form of new build generation in many cases, and costs will continue to fall dramatically.
“Massive increases in future renewable power generation mean that industry and government must start planning now to ensure low-carbon, cost-effective ways of balancing demand and supply.”
Balancing supply and demand will be one of the biggest challenges for the National Grid as wind and solar become more central to the country’s energy market, given the variable nature of these two sources of renewable energy, which are much more unpredictable (and weather dependent) in nature than traditional power stations.
One strategy that will become increasingly important for balancing energy supply and demand will be ‘demand response’, which could see industrial firms quickly respond to surpluses on the grid by consuming additional renewable energy for variable industrial loads. Another approach is smart metering, which can help address changing conditions on the grid by dynamically adjusting the price of energy supply (upwards, in the case of an energy deficit; downwards in the case of an energy surplus) during periods of variable energy generation.
Energy storage solutions will also become more important as the Grid strives to ensure there are additional options available to meet demand when wind and solar fail to generate enough electricity due to dense cloud cover or low wind speeds.
However, there will also be a requirement for other energy sources that can serve to plug the power supply gap during times of peak demand, and traditional baseload power plants, whether they run on fossil fuels or nuclear power, will be less suitable to meet this need, since they are specifically designed to run at a constant, stable output rather than serving as a gap-fill.
“This study highlights a seismic shift in how power systems will operate in the future. As wind and solar become the cheapest options for power generation, the race is on to develop and deploy the flexible resources that will complement them,” explained Albert Cheung, head of global analysis at Bloomberg New Energy Finance.
There is already one likely candidate though: fuelled renewable energy sources, such as biomass and energy from waste, which can serve as a gap-fill because they have much more flexibility than baseload power plants, yet they are not weather dependent like wind and solar.