United Kingdom 2024 Energy Policy Review
Executive Summary
The International Energy Agency (IEA) conducted a peer review of the United Kingdom's (UK) energy transition in November 2023, aligning with the country's ongoing efforts to align its energy strategy with industrial and energy security goals. The UK was one of the first major economies to legally establish a net-zero target in 2019, and it has made significant strides in reducing greenhouse gas (GHG) emissions, with a 53% reduction from 1990 levels in 2023.
Key Data and Trends
- GHG Emissions: The UK has committed to lowering emissions by 68% from 1990 levels by 2030.
- Energy Transition: The UK aims to fully decarbonize the power sector by 2035 and deploy up to 50 GW of offshore wind by 2030.
- Electricity Generation: Coal power generation has declined significantly, with most coal-fired power plants expected to close by October 2024. Nuclear's share in electricity generation has also decreased to about 15%.
- Renewable Energy: Renewables now account for 42% of the electricity mix, up from less than 14% in 2012, led by wind.
- Buildout of Grid Infrastructure: A massive expansion of grid infrastructure and rapid growth in grid connections will be critical to support the energy transition.
Energy Efficiency and Decarbonization
- Buildings Sector: The UK buildings sector, accounting for over a quarter of energy emissions, needs sustained focus on energy efficiency upgrades and electrification of heating systems.
- Cost Considerations: The cost of electricity remains a barrier to affordable fuel switching, and efforts to rebalance costs between electricity and natural gas are encouraged.
Transport Sector
- Decarbonization Roadmap: The transport sector, responsible for over one-third of domestic energy-related emissions, has comprehensive strategies to facilitate the decarbonization of the light vehicle fleet through zero-emission vehicle (ZEV) mandates and other tools.
- Implementation: Strong policies are in place to increase the uptake of ZEVs, including regulations that entered into force in January 2024.
Industrial Decarbonization
- Near-Term Goals: The industrial sector, accounting for around 14% of emissions, should focus on optimizing energy efficiency gains and enabling investment in deep decarbonization.
- Technologies: Electrification, carbon capture, utilization, and storage (CCUS), and hydrogen will play crucial roles in industrial decarbonization.
- Cluster Approach: The UK's cluster approach to CCUS, leveraging regional industrial advantages, is seen as a positive strategy.
Future Outlook
- Hydrogen Role: Low-carbon hydrogen is expected to play a more prominent role in the industry sector, with the UK becoming a key driver in hydrogen development.
- Ongoing Challenges: Meeting carbon budgets will become increasingly challenging, requiring more policy action to support investment across multiple sectors.
Overall, the UK is well-positioned to continue its energy transition, but significant efforts are needed to accelerate action and address ongoing challenges.
