The long-anticipated Energy White Paper will soon set out the Government’s proposals for future legislation, detailing the UK’s path to net zero by 2050 including which technologies will receive support.

Originally due to be published in the summer of 2019, it’s since been delayed numerous times and was promised as on its way ‘in a matter of weeks’ back in March.

Covid and Brexit continue to consume much of the government’s bandwidth, but nevertheless there’s a particular pressure to deliver. Our 2050 net zero commitment isn’t going anywhere, but the more immediate driving force is next year’s delayed COP26 in Glasgow, when the eyes of the world will be on the UK, expecting it to walk the walk.

So, when will we get the White Paper and what might it contain?  Those in the know say it will arrive in November and focus on offshore wind, new nuclear, and a carbon tax. Also predicted is a Carbon Capture Usage and Storage (CCUS) strategy, a transportation decarbonisation plan, a heat policy road map, a net zero consultation, an aviation consultation, and an English tree strategy.

Camargue works across the full spectrum of energy, so I’ve courted the opinions of a cross-section of colleagues active in specific sectors to make a few predictions on what the Energy White Paper could – and should – contain:

Offshore and onshore wind

Offshore wind is the new poster child of the government’s clean energy ambitions – and rightly so. From a standing start 20 years ago, the UK now leads Europe and the world through a combination of innovation and investment, thriving coastal hubs, and consistent steady support of the type that international investors favour. Much hinges on maintaining this stability and the long-term view.

The exponential growth required to help deliver net zero – an estimated eight-fold increase by 2050 – will need careful planning and coordination. Green hydrogen made using wind energy will further increase demand for capacity. A new generation of floating wind turbines will soon unlock new, deeper areas of seabed. It’s encouraging to see that how the onshore grid adapts to this is already being actively considered.

For onshore wind, after years in the political wilderness the expectation is that it will be brought back into the Contracts for Difference (CfD) scheme. Despite being the cheapest form of renewable energy, it still feels like a political hot potato (in England at least). But equally the government also needs to recognise that – like the resurgent solar power – it could soon be cheap enough not to require support, and simple economics alone will then drive its growth as well as a potential clash with current policy.

New nuclear

Above all, the White Paper needs to revive confidence in new nuclear. Few sources of low-carbon power can match its capacity and economic heft. In the UK, we have some of the best nuclear sites anywhere in world, and a rich industrial heritage when it comes to development and operation. But these alone won’t get the job done.

The reality is new nuclear requires significant up-front investment. If government is serious about getting the sector back up and running, a new way of financing development is required – potentially with it taking an equity stake or introducing a Regulated Asset Base (RAB) model for investors. This means the risk would partly sit with the taxpayer but could – finally – see at least one more new nuclear power station go into operation. Industry will be watching closely to see how far the government is willing to commit.

Alongside ‘big’ nuclear, we may also see a policy on smaller modular reactor (SMR) technology. These ‘baby’ nuclear power stations are attractive propositions and could provide significant capacity more quickly and cheaply than their larger siblings, making a big dent in our carbon targets. Government has already hinted it could invest in SMRs, but developers and regulators will want to see a policy that stimulates the sector and encourages investment.

Carbon Capture Usage and Storage (CCUS)

CCUS is crucial to meeting net zero, and it’s come blazing back into the headlines in recent days.

The Northern Endurance partnership, international alliances formed of oil and gas majors including BP and Royal Dutch Shell as well as National Grid, are proposing projects on the Humber and on Teesside.

Despite a push in the middle of the last decade CCUS (or CCS as it was known then) didn’t get off the ground. “There is no serious commercial incentive, and it will stay that way unless the state demonstrates there is a business there” as one expert noted.

Fast forward several years and those same challenges remain. So, the government will have to demonstrate the business case, most likely in the form of sizeable incentives and risk sharing. It’s one area where delivering net zero may come with a hefty price tag.

Decarbonising transport

How we cut transport emissions remains one of the largest pieces missing from the UK’s net zero puzzle. Transport is the UK’s biggest polluter but we’re yet to see a coherent, holistic plan for reducing its impacts. The government has talked a strong game on banning the sale of new petrol, diesel and hybrid cars and consulted over the summer on bringing a ban forward to 2035. At the same time, it’s pushed hard to expand the availability of rapid charging points on the strategic road network.

We may get an update on both of these policies, however, there’s unlikely to be much more substance on transport. Instead, it is likely to point the way to a more detailed transportation decarbonisation plan (already announced in March) and the National Infrastructure Strategy, the one document more anticipated than the Energy White Paper.

Aviation

The UK aviation sector has taken some hefty knocks over the past months.  Following the legal challenge against Heathrow expansion and with Covid galloping in behind, the industry undoubtedly faces some challenging headwinds.

Aviation is recognised as a hard sector to decarbonise but also, a vital one. We hope to see a concerted push to promote investment and opportunities in Sustainable Aviation Fuels (SAF), alongside incentives for more fuel and carbon efficient planes. To make SAF cost efficient requires a significant increase in production, and this will almost certainly require substantial financial and regulatory backing.

Whatever the Energy White Paper holds, its mere existence will be welcomed across the sector, as energy policy in recent years has drifted. It needs to lay a clear, bold, unambiguous path for every corner of the energy sector to take, for what will be a marathon collective effort to get across the line by 2050.

Mike Cheshire headshot

Mike Cheshire is an account director at Camargue

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