The Energy White Paper: Explainer

Not got time to trawl through the small print of the Energy White Paper in advance of COP26 this November? Don’t worry – we’ve got you.

The Energy White Paper was released by the Department for Business, Energy, and Industrial Strategy (aka BEIS) in December 2020, and forms the foundation of the proposed strategy to help the UK achieve its goal of net-zero emissions by 2050. 

A white paper is a policy paper that outlines a course of action or future legislation proposed by the Government. It forms a basis for follow up discussion and consultation by Parliament.

Where does the Energy White Paper sit in the UK’s recent climate change legislation timeline?

The Energy White Paper builds on the investment strategy the UK published in its Ten Point Plan for a Green Industrial Revolution with a focus on how it will clean up the UK’s energy system. It is published amid progressively more ambitious greenhouse gas emissions targets outlined in the UK’s updated Nationally Determined Commitments (NDC) and the Sixth Carbon Budget. The Energy White Paper supersedes the UK’s Integrated National Energy and Climate Plan (not shown in the infographic above).

So, what is in it?

The Energy White Paper is split up into six chapters: Consumers, Power, Energy System, Buildings, Industrial Energy, and Oil and Gas. It also includes explainer sections on the Ten Point Plan, BEIS energy supply/demand modelling, and transport. Key commitments reiterated throughout the document are highlighted below.

Energy efficiency/ mitigating greenhouse gas emissions:

• Improving the energy efficiency of buildings through grants and discounts including Green Homes Grants and Warm Homes Discount, and requiring all non-domestic rented buildings be EPC band B or better by 2030.
• Powered by electricity! – shifting how we power our homes from gas to electricity; installing more electric heat pumps. Electrifying transport by ending the sale of petrol and diesel cars and vans by 2030.
• Carbon capture utilization and storage (CCUS)– commitments to support at least one power CCUS plant to be operational by 2030; aiming to capture 10MtCO₂ per year by 2030.
• Industrial Decarbonization Strategy (published in March 2021) to outline how industry can decarbonize to meet the UK’s net-zero target without pushing emissions abroad or losing competitive advantage.

Powering the UK with a greener portfolio:

• More renewables! – commitments to increase offshore wind production, targeting of 40GW by 2030.
• Nuclear – Hinkley Point C is under construction (commissioned in mid-2020s); at least one more large-scale nuclear project will be brought to the Final Investment Decision by end of Parliament. Advanced nuclear: Small Modular Reactors and Advanced Modular Reactors, and continued investment in Fusion. There are aims for a commercially viable Fusion plant by 2040 – is this a realistic goal?!
• Coal closure – a proposed consultation to bring the date of coal closure forward to 2024.
• Consult on updates to the Gas Act to ensure decarbonizing gas supplies is facilitated in legislation.
• North Sea Transition deal between the Government and Offshore Oil and Gas Industry (published March 2021) to secure new low-carbon export opportunities.
• Make the UK continental shelf a net-zero basin by 2050.

Flexibility and energy storage:

• Low-carbon Hydrogen – The Government aims to develop 5GW of low-carbon hydrogen production by 2030. A dedicated Hydrogen Strategy (published August 2021) will outline the roadmap to achieve this goal.
• The Government aims to legislate (but only if there is time in before the end of Parliament to do so) to define energy storage in law.
• Commitments to invest in long-term storage technologies.
• The future will be Smarter – The Government plans to support the installation of more Smart meters, and advance the regulation of Smart appliances with regards to safe data handling.

The flurry of policy papers, consultations, and reports published by the Government departments and Parliamentary committees in advance of the UK’s presidency over COP26 is promising, as long as the UK can deliver on these lofty goals and keep to its own deadlines.

Perhaps one of the more worrying admissions in the Energy White Paper is that there is no expectation to be able to cease the production of oil and gas by 2050.

The most optimistic estimate by the Climate Change Committee is that production of natural gas could drop to 80% by 2050, compared to levels in 2017. However, UK companies are and will be encouraged to diversify their energy production portfolio, and to address their emissions by supporting CCUS and low-carbon hydrogen production.