The Energy Management Association (EMA) has revealed its five industry trends to watch this year, which it says promises to be an interesting one considering the pace of technological progress, important policy changes and the continued uncertainty over Brexit.
Here are the top line trends (click here for the full article):
- Streamlined Energy & Carbon Reporting (SECR)
The final guidance for SECR will be published in January with the scheme coming into effect in April. Although the final guidance is still to be tweaked, it is really only setting out the obligations placed on organisations.
If you are a large company listed as such by meeting two of the following three criteria; 250 employees, £36 million turnover and an £18 million balance sheet you will need to comply. The public sector is not covered unless they own entities that undertake commercial activities and there is a no need to file a report if you use less than 40,000 kWh during the reporting period.
So here are the main actions your company will legally need to undertake:
- Collect and publish greenhouse gas emissions, energy consumption which includes transport fuel, and energy efficiency actions taken.
- Present the data on emissions to be signed off by auditors.
- Compile an energy efficiency narrative for the Director’s Report, this will need to state all principal energy efficiency actions undertaken during the reporting period.
- Present to the Board for sign off, for an LLP this needs to be presented by a named member.
- Included in the company report or lodged as a separate report with Companies House.
2. Energy Savings Opportunity Scheme (ESOS) Phase Two
We are now in Phase 2 of the ESOS compliance scheme so let’s recap some facts. The ESOS Regulations 2014 is a reiteration of the Article 8 of the EU Energy Efficiency Directive and mandate that large organisations in the UK undertake comprehensive assessments of energy use and energy efficiency opportunities at least once every four years.
In broad terms, ESOS applies to any large undertaking that carries out a trade or a business (a Company), and any corporate group where at least one member of the UK group meets the ESOS criteria.
3. Electric Vehicles
Against the backdrop of improving technology and accelerating climate change, the UK Government has published its Road to Zero Strategy, which foresees that a third of the UK’s fleet on the road in 2030 will be electric. The government has also vowed to end sales of internal combustion vehicles in the UK by 2040.
This is an optimistic prediction considering 2030 is only eleven years away. Furthermore there is a problem with zero emissions at the tail pipe, as the energy must be provided by the grid and the resulting load will not be inconsiderable.
A privately owned EV can roughly double the electricity use of the average UK home. As a result, one third of the current UK fleet, or 10 million vehicles equates to the power needed for approximately up to 10 million new homes.
National Grid forecasts that EVs will create an additional 18GW of demand by 2050, which is one-third higher than today’s peak demand.
4. The Energy uncertainty of Brexit
With European energy interconnections forecasted to account for one-fifth of UK consumption by 2025, the implications of Brexit on energy prices will be important.
Given that energy suppliers purchase energy months or years ahead, the uncertainty will give rise to significant risk premiums on energy prices. The increasing risk will lead to higher consumer prices, a major problem for long-term business planning.
Additionally, regulatory uncertainty extends to the European Union’s carbon pricing, leaving the UK’s companies unclear on whether the same rules will apply post-Brexit.
5. Battery Storage
This is one area that could become really exciting in 2019 because your site could benefit from hosting batteries. Work is being undertaken to allow DNOs to source contracts for battery services in the area of Demand Side Response.
Simply put, the DNO could work out the cost of upgrading, reinforcing or building in resilience and instead of building new substations, they could meet their requirements by contracting out demand reduction services through contracts with independent aggregators.
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