RENEWABLE ELECTRICITY
22. It will be up to Member States to decide on the
mix of contributions from the heating and cooling, transport and
electricity sectors necessary to reach their EC Mandated Target
for renewable energy consumption. We note, however, that the draft
Directive on the promotion of the use of energy from renewable
sources mandates that Member States source at least 10 per cent
of transport fuel from biofuels by 2020.
23. John Loughhead, UK Energy Research Centre (UKERC),
told us that it would be technically difficult to substantially
increase the share of renewables in the UK's heat sector by 2020.[17]
Although some renewable heat technologies are now cost effective
in some situations (such as large scale biomass heating off the
gas grid), most are not commercially competitive with gas heating.[18]
At present the amount of renewable heat in the UK is extremely
low (0.6 per cent of heat demand[19]).
Based on the assumption that 10 per cent of transport fuel will
be derived from renewables, UKERC calculated the contribution
required from the renewable electricity sector necessary for the
UK to meet the overall EC Mandated Target of 15 per cent renewable
energies by 2020. Two situations were considered: either 5 per
cent or 10 per cent renewable heat energy. In the former situation,
UKERC estimate that 54.5 per cent of electricity will need to
be renewable, in the latter, 42.8 per cent renewable electricity
will be required[20].
All the witnesses we spoke to expected that it will be necessary
to source 35-40 per cent of electricity from renewables if the
UK is to generate 15 per cent of energy from renewables by 2020[21].
In light of the estimates from UKERC, however, it is possible
that the share of renewable electricity required to meet the UK's
2020 targets will increase beyond 40 per cent.
National targets for renewable electricity generation
24. In 2006, 4.55 per cent of the UK's electricity
was generated from renewables.[22]
Increasing renewable electricity production to 35-40 per cent
of supply by 2020 represents a significant challenge, particularly
as the Government's targets for renewable electricity are completely
inconsistent with this ambition. National Targets are to:
- increase the share of renewable
electricity to 10 per cent of total supply by 2010, with an aspiration
for this to double by 2020;[23]
and
- triple renewable electricity to approximately
15 per cent of supply by 2015.[24]
25. As shown in Figure 1, the UK's National Targets
are clearly inadequate to meet the proposed EC Mandated Target
for the UK. The 2010 target would generate only half of the renewable
electricity required, and meeting the 2015 target would require
renewable electricity production to double in the following five
years.

Source: ec.europa.eu/eurostat/
26. When asked to comment on the adequacy of the
Government's renewable electricity targets, the Minister told
us that:
We had a strategy in place that was already delivering
against the UK targets, but [
] that given the goal posts
have changed [
], because of the new European targets, we
need to ask are our existing policies adequate? No they are not.
Do we need to review to make sure that we can get to the 15 per
cent target, or whatever it is, yes we do, and that is why we
are now developing a new Renewable Energy Strategy.[25]
27. The Minister went on to tell us that "the
momentum in terms of our total energy coming from renewables is
increasing, I would argue, quite dramatically year by year".[26]
Similarly Michael Duggan, Deputy Director of the Renewables Obligation
team, BERR, reported a "tripling of the deployment"
of renewable technologies over the last five years.[27]
We note, however, that Mr Duggan's statement is predicated on
a low baseline - 1.8 per cent renewable electricity in 2002 (excluding
large-scale hydro) - and that it will be necessary to double the
current level of renewable electricity-generation if the UK is
to achieve its 2010 target of 10 per cent of supply from renewables
(see Figure 1).
28. We appreciate that the UK renewables targets
laid out in the May 2007 Energy White Paper were set prior to
the publication of Member States' proposed EC Mandated Targets
in January 2008. However, the European Commission proposed the
overall target of 20 per cent renewable energies by 2020 in January
2007, and Member States accepted the proposal in March of the
same year.[28] Given
that the UK Government has expressed its commitment to the EU
2020 renewables target[29],
we find it disappointing that it has not acted to update its own
Renewable Energy Strategy sooner, and further, that it maintained
its commitment to the targets laid out in the 2007 Energy White
Paper in Budget 2008.
29. We do not consider current UK targets for
renewable electricity generation to be of sufficient scale or
ambition. The Government's commitment to triple renewable electricity
production by 2015 will equate to the production of approximately
15 per cent of total electricity supply. If the UK is to meet
the proposed EC Mandated Target of 15 per cent renewable energy
by 2020, it would then become necessary to more than double renewable
electricity-generation capacity between 2015 and 2020.
30. It is not only the adequacy of the UK's targets
for renewable electricity generation that concerns us, but also
the lack of progress that has been made towards achieving them.
Take the Government's ambition to source 10 per cent of electricity
from renewables by 2010. Since this target was announced in January
2000[30], the share of
renewable electricity in overall UK consumption has increased
from 2.7 per cent of supply in 2000 to 4.6 per cent in 2006.[31]
Based on current rates of progress, it is forecast that renewable
electricity will constitute 6 per cent of gross electricity supply
in 2010.[32] We find
it highly unlikely that, given current progress, the UK will meet
the Government's ambition for 10 per cent of electricity to be
generated from renewables by 2010, let alone the EC Mandated Target
for 15 per cent renewable energies by 2020.
RATIONALISING THE TARGETS
31. Targets for renewable energy generation comprise
two tiers. The first tier, or 'headline' target, stipulates the
proportion of total energy to be generated from renewable sources,
whereas the second tier outlines the contribution required from
the electricity, heating and cooling and transport sectors to
meet the overall target. In the case of the UK's EC Mandated Target
for renewable energy, the headline target will be determined by
the European Commission, and the form of the second tier by the
Government.
32. In conducting this inquiry we found the plethora
of UK renewables targets to be confusing and unnecessary. Possible
targets for renewable electricity-generation now range from 10
per cent of supply by 2010[33]
to 40 per cent of supply by 2020.[34]
The forthcoming consultation on a new renewables strategy for
the UK represents an opportune time to revisit these targets and
to promote a unified message.
33. We recommend that, as soon as the UK's EC
Mandated Target is known, the Government outline the UK's renewable
energy targets in a single statement. This statement should set
the context for the Government's new Renewable Energy Strategy,
stipulating the country's 2020 target for renewable energy generation,
and signposting the contribution required from the electricity,
heating and cooling and transport sectors required to meet the
headline target. In addition to setting targets for each renewable
energy sector, it is vital that the Government's Renewable Energy
Strategy provides a clear policy framework for achieving them.
5 DTI, Our energy future - creating a low carbon economy,
CM 5761, p12, HM Treasury, Meeting the Energy Challenge, Cm 7124,
May 2007; Commission of the European Communities, Memo on the
renewable energy and climate change package (Memo/08/33), January
2008 Back
6
http://www.timesonline.co.uk/tol/news/environment/article3257728.ece,
The Sunday Times, 27 January 2008 Back
7
Commission of the European Communities, Memo on the renewable
energy and climate change package (Memo/08/33), January 2008 Back
8
Proposal for a Directive of the European Parliament and of the
Council on the promotion of the use of energy from renewable sources,
COM(2008) 19 Back
9
Commission of the European Communities, Memo on the renewable
energy and climate change package (Memo/08/33), January 2008 Back
10
Q 345 Back
11
Ibid. Back
12
Q 8 Back
13
Uncorrected transcript of oral evidence taken before the Business
Enterprise and Regulatory Reform Committee on 31 January 2008,
HC (2007-08) 293-i,Q 150. Back
14
Ev 382 Back
15
Federal Ministry for the Environment, Nature Conservation and
Nuclear Safety, Development of renewable energies in 2006 in Germany,
February 2007 Back
16
Federal Ministry for the Environment, Nature Conservation and
Nuclear Safety, EEG - the renewable energy sources act, July 2007 Back
17
Q 2 Back
18
http://www.berr.gov.uk/files/file43609.pdf Back
19
http://www.berr.gov.uk/energy Back
20
Ev 383 Back
21
Qq 2, 7, 66, 67, 348 Back
22
http://restat.org.uk/electricity.htm Back
23
HM Treasury, Our energy future - creating a low carbon economy,
Cm 5761, February 2003 Back
24
HM Treasury, Budget 2008, HC 388, March 2008 Back
25
Q 346 Back
26
Q 343 Back
27
Q 79 Back
28
http://europa.eu/rapid/pressReleasesAction.do?reference=IP/07/29&format=HTML
&aged=0&language=EN&guiLanguage=en Back
29
http://www.berr.gov.uk/energy/sources/renewables/strategy/page43356.html Back
30
DTI, Our energy future - creating a low carbon economy, Cm 5761,
p12 Back
31
http://ec.europa.eu/eurostat Back
32
Cambridge econometrics, UK energy and the environment,
(2008) Back
33
HM Treasury, Meeting the Energy Challenge, Cm 7124, May
2007, p14 Back
34
Q 348 Back