Where does wind fit in UK’s post-Brexit energy policy?


July 8, 2016

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The UK’s decision to leave the European Union may have sparked crises in both politics and the economy, but it is also distracting from another homegrown crisis.

In the next decade, the UK is heading for a major energy shortage if it pushes ahead with plans to close all remaining coal power plants by 2025. The Institution of Mechanical Engineers warned in a report in January that this would create an energy gap of 55% by 2025. This is another complex problem that will sit on the desk of the new prime minister: Theresa May or Andrea Leadsom.

That leads us to our central question: what role could onshore wind play in the UK’s post-Brexit energy strategy?

Well, we have done the pessimistic version before. We still see a risk that whoever takes control of the Conservative Party, and thus the country, could use Brexit as a way to pull back from European renewables goals. This could further marginalise wind farms that are already being hampered by cuts to subsidies for new onshore wind developments. In particular, Conservative leadership hopeful Leadsom has committed to end all subsidies for wind farms.

But let’s try being optimistic. After all, energy secretary Amber Rudd said last week that the UK’s Climate Change Act, introduced in 2008, is going nowhere. This commits the UK to reducing its carbon emissions by at least 80% in 2050 from 1990 levels, but gives little detail on how it should be done. This has supported growth in renewables over the last five years, but the government is also using it as a justification for backing nuclear power.

The problem is that its flagship nuclear project, EDF’s £18bn Hinkley Point C, is far from certain to happen. The French utility has kept delaying a final investment decision on the scheme as it faces concerns from shareholders that the scheme poses a threat to EDF’s very existence; and there is speculation that Brexit could be the reason the firm needs to quietly drop the scheme, despite backing it in public. A decision is now due in autumn.

This is part of the government’s commitment to develop six new nuclear power stations in the UK with total capacity of 18GW but, even if they go ahead, there is no guarantee that they would complete by 2025. That opens opportunities for sources like wind.

There may be no new subsidies but, in theory, developers can still build schemes that don’t rely on them. Indeed, Good Energy has already pledged to do so. But subsidies are not the only hurdle. Developers also need to win planning consent.

This is where our optimism wanes.

Winning the EU referendum has emboldened the right-wing of the Conservative Party, which includes MPs like Leadsom that tend to be more sceptical about the science of climate change, and more receptive to constituents who think wind farms are blighting the landscape. The new prime minister, May or Leadsom, will have to keep this wing of their party happy as they negotiate Brexit, and the wind sector could suffer in this horse-trading.

Still, let’s end on a silver lining. The UK government sees the looming energy crisis as a justification to rush to natural gas fracking, but public opposition to fracking is far more widespread than for wind farms. Hostility to fracking could open the door for wind — and likely advances in reliability-boosting technology like storage can only help wind’s business case.

Onshore wind offers competitively-priced power that can be deployed quickly. This should stand the industry in good stead with an energy crisis looming. But, as ever, politicians will be key.

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