A new Bloomberg New Energy Finance economic study, commissioned by Eaton in partnership with the Renewable Energy Association highlights the significant changes to energy generation mix in the UK and other European countries.
Faster than predicted falls in the cost of renewables is set to result in renewable cost parity with thermal plant sooner than predicted; even in some cases making new-build renewables cheaper than existing fossil fuel plant.
The key findings of the report are:
- Economic tipping points mean renewable energy will account for over half of electricity generation by the mid-2020s in the UK and Germany
- Renewable energy will meet more demand, more often – driving opportunities for flexibility including storage and increased usage of interconnectors
- System volatility will increase markedly in the UK and Germany – providing opportunities for fast-ramping resources, but creating a challenging environment for non-variable baseload technologies such as nuclear
- Due to lengthy seasonally induced renewable generation gaps, the total back-up capacity needed in 2040 is much the same as in 2017. The ongoing need for this capacity, combined with significant drops in its utilisation, harms the economics of non-renewable generation plants such as coal and gas
- A future energy system in the UK and Germany dominated by variable renewable generation must be complemented by flexible resources – in particular storage. The Nordics’ spare flexibility presents opportunities via interconnectors to plug the potential flexibility gaps in the UK and Germany
The full report can be viewed by following the link in the title and banner image.