2020 renewable heat and transport targets Contents

Annex: Informal roundtable meeting, Wednesday 4 May

On Wednesday 4 May, the Committee held an informal roundtable meeting with guests from the Government and academia. This was conducted under Chatham House rules (an agreement not to attribute statements made to the individuals making them) to encourage open and creative dialogue at an early stage of the inquiry. The following individuals participated:

Committee Members

Angus Brendan MacNeil MP, Rushanara Ali MP, Mr Alistair Carmichael MP, Glyn Davies MP, James Heappey MP, Matthew Pennycook MP, Antoinette Sandbach MP, and Julian Sturdy MP

Government Officials

Jerome Glass, Deputy Director, Ronan Devaney, Senior Policy Advisor, Strategy Directorate, Sarah Redwood, Deputy Director, Heat in Buildings, and Tim Warham, Senior Policy Advisor, Clean Energy Directorate, Department for Energy and Climate Change, Aaron Berry, Head of Biofuel Strategy, and Rob Wakely, Head of Low Carbon Fuels, Department for Transport, and Richard Bruce, Director, Office for Low Emission Vehicles

Academics

Professor Philip Eames, Professor of Renewable Energy, Loughborough University, Dr Nick Eyre, Co-Director, UK Energy Research Centre, and Dr Grant Wilson, Research Associate, Chemical and Biological Engineering, University of Sheffield

House of Commons Staff

Dr Farrah Bhatti, Clerk, Gavin O’Leary, Second Clerk, and Josh Rhodes, Specialist, Energy and Climate Change Committee, and Dr Aaron Goater, Environment and Energy Advisor, Parliamentary Office of Science and Technology

An unattributed summary of discussions follows. It does not state the position of either the Committee or the Government.

2020 renewables targets and UK progress towards them

The 2020 renewables targets are distinct, if overlapping in purpose to the Climate Change Act 2008 and carbon budgets. Divergences include bioenergy (which contributes more to renewables than decarbonisation targets) and energy efficiency (which contributes more to decarbonisation than renewables targets). However, the Renewable Heat Incentive (RHI) and Renewable Transport Fuel Obligation (RTFO) are two of the Government’s most important non-electricity decarbonisation policies. The UK’s overall renewable target of 15% is among the most challenging in the EU in absolute terms, but it has met all interim targets so far and is likely to meet the next, it was argued. According to some, the UK will exceed its 30% electricity sub-target, but heat and transport are more difficult, being consumer rather than Government led.

Heat

Some suggested that progress in heat is a crucial stepping-stone to overall decarbonisation in the long term. Unlike transport, with regular churn in the vehicle stock, heating equipment tends only to be replaced through individual distress purchases, and furthermore, the UK building stock is insufficiently energy-efficient, it was contended. There was an opinion that low-carbon heating systems are quite different from condensing boilers and installers’ skill-set may be inadequate. It remains unclear which combination of heat pumps, green gases, hydrogen or other technologies is the best long-term heating solution.

RHI reform, which the Government is consulting on, aims to improve affordability and value for money with cost controls, to support crucial long-term technologies while transitioning away from a near-exclusive focus on biomass, and to move from subsidy-dependent to sustainable markets.

All heat suppliers must notify the National Measurement and Regulation Office if they have an existing heat network. This provides Government with a comprehensive dataset of the location and scale of heat networks in the UK. This data is due to be published by December 2016.

Some had concerns that district heating is uncompetitive, especially given that regulation is presently industry-led. District heating has been successfully installed in social housing with the help of low-cost loans taken by local authorities, it was highlighted. However, the roundtable noted it is harder to sell properties with legacy commitments to district heating, thus such installation is harder in the private sector. District heating only contributes to renewable energy targets if powered by a renewable source.

It was suggested that there be an office for low-carbon heat, with staff from both DECC and the Department for Communities and Local Government (DCLG), similar to the Office for Low Emission Vehicles (OLEV).

Heat electrification is challenging, as full electrification could triple or quadruple winter electricity-demand peaks, according to some. Seasonality in heat demand is inescapable given the UK climate.

Transport

The RTFO is the Government’s primary means to decarbonise transport in the short term, it was noted. It will provide, by one estimate, 95% of the 10% renewables target in transport (with road and rail electrification contributing the remaining 5%). There are challenges increasing the level of biofuel in petrol—unlike E5, E10 won’t work with all older vehicles. It was argued that transport-fuel plants in Northern England have been harmed by the low current level (4.75%) of the RTFO and the low price of oil.

The Government’s ambition to make every new car zero-emission by 2040 is challenging, in the view of some. The UK has the best network of electric vehicle (EV) rapid charging points in Europe—with 900 such points and 11,000 public charging points in total—and the fastest-growing market for EVs in the EU in 2014. However, it was suggested that correlation between charging infrastructure and EV uptake isn’t straightforward: prospective EV users want public charging points, but actual EV users tend to charge at home and work. Still, the approximately 70,000 EVs in the UK are a small proportion of the 2 million new cars every year, and a smaller proportion still of the 20 million cars on the road.

It was estimated that the Government raises £27 billion annually in fuel duty, and that this may fall significantly with wide uptake of EVs. It was suggested that HM Treasury consequently lacks an incentive to encourage EV uptake.

Issues regarding biodiesel and blocked filters were raised; the Government is looking into this matter, but there is no conclusive evidence that biodiesel has caused the damage.

Biofuels

Scientific consensus, including the position of the Intergovernmental Panel on Climate Change, is that burning biomass (or any fuel of recent biological origin) has zero net carbon emissions as greenhouse gases released are equal to those absorbed during production. Biofuel carbon emissions are therefore caused by ancillary processes (such as drying and transport) and land-use change. It was argued that emissions from drying and transport tend to be low compared with fossil-fuel combustion. The Committee on Climate Change’s advice on the fifth carbon budget emphasised the long-term importance of negative-emissions technologies, such as biomass with carbon capture and storage. There was uncertainty over the UK’s domestic biofuel-production capacity.

Fuels from wastes avoid land-use change, and are ‘double-counted’ for the transport target. Used Cooking Oil is currently the most prominent waste fuel in the UK. DfT is spending £25m on three waste-fuel projects over three years, looking at fuels from forestry residues, whisky-industry residues and municipal waste.

Hydrogen

It was suggested that the most likely sources of hydrogen until 2050 are hydrolysis using surplus renewable electricity or as a CCS by-product. Hydrogen extracted from fossil fuels without CCS has a high carbon footprint, according to some. Germany sees power-to-gas as a way of using its solar surplus. The UK was one of three markets chosen by Toyota to launch its hydrogen fuel-cell vehicle, and there will be 12 hydrogen filling stations in the UK by the end of 2016. However, there remain concerns about hydrogen’s wider commercial viability.

A whole-systems approach

The essence of a whole-systems approach is to envisage the energy systems in 2050, then consider work needed to enable it. There was debate about the role of biofuels: are they a transitional replacement for fossil fuels, or an important component of the 2050 energy system? Government Departments don’t always work across silos, it was argued: indeed, energy legislation tends to divide sharply electricity, gas and heat policies. However, ULEV has staff from DECC, DfT and the Department for Business, Innovation and Skills, also working closely with HM Treasury.

Two observations were made regarding the energy system in the long run. Firstly, decarbonisation will depend significantly on low-carbon electricity—as heat and transport decarbonisation are planned on the basis of electrification. Secondly, the current energy system depends heavily on fossil fuels for storage, and a decarbonised economy needs to find new ways to use surpluses.

The Committee’s inquiry

There is no silver bullet for the challenges in meeting renewables targets. It was argued that the Committee may have more influence on longer-term strategy than Government policy towards the 2020 targets, and should prioritise accordingly in its inquiry.





© Parliamentary copyright 2015

7 September 2016