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Distributed Generation: From Cinderella to Centre Stage

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image The report finds that the current regime has been struggling to cope with recent growth of distributed generation driven by the increasing popularity of renewables

A new report to be published tomorrow (Wednesday December 5th) concludes that distributed generation will play an increasingly important role in helping to solve the UK’s energy trilemma and realise Energy Bill ambitions.

The report by Carbon Connect, an independent forum of parliamentarians and leaders from across the energy sector, calls for the Government to ‘establish a clear vision for distributed generation’, urging that stronger and clearer leadership is needed from Government to coordinate and drive the growth of distributed generation. Action is also needed to reform a regime that is struggling to cope with recent expansions in distributed generation and address barriers developing the electricity system efficiently.

The independent report, supported by Siemens and Covanta Energy, makes over 20 clear recommendations for Government, Ofgem, Distribution Network Operators and others with the future of distributed generation in their hands. Recommendations include establishing a formal and permanent position for the agenda within the Department of Energy and Climate Change and improving the Government’s understanding of the ten benefits of distributed generation identified in the report.

The inquiry, chaired by Laura Sandys MP, found that distributed generation has the potential to contribute to security, sustainability and affordability objectives. Distributed generation will be particularly critical in the trebling of renewables capacity to 45 gigawatts by 2020 and delivering around 40 per cent additional lower carbon energy from combined heat and power by 2020 bringing installed capacity to around nine gigawatts. Distributed generation currently represents around 11 per cent (nine gigawatts) of the UK’s electricity capacity and over half of this is renewables. Laura Sandys said:

A huge amount of our energy infrastructure needs replacing or upgrading within the next ten years if the UK is to keep the lights on and meet its carbon reduction targets. Distributed generation is an important gateway to the deployment of many low carbon technologies, from wind to biomass and solar power. Moreover it can play an important role in helping the UK to meet the three challenges of the energy ‘trilemma’ – sustainability, affordability and security. Laura Sandys said:

“Distributed generation presents the opportunity to quickly deliver much needed new generating capacity and attract investment in energy infrastructure from new and diverse sources. This is important if the UK is to keep the lights on as supply margin falls from 14 per cent to 4 per cent by 2015/16 and as the UK seeks £110 billion pounds of investment in energy infrastructure by 2020.”

The report further calls for greater policy stability and continuity across the energy market in order to attract investment, particularly in low carbon generation. In addition, the inquiry recommends greater roles for Local Enterprise Partnerships and the Department for Communities and Local Government in promoting strategic energy management in businesses and ensuring that local planning guidance sends a clear and consistent message to planning professionals regarding the economic, environmental and social viability of distributed generation.

The report finds that the current regime has been struggling to cope with recent growth of distributed generation driven by the increasing popularity of renewables. Ofgem, Distribution Network Operators and Local Authorities are called to work together and make changes to provide a better service to distributed generation developers, allowing more efficient development of the electricity system in this critical phase of its 130 year history.

Despite the growth in distributed generation already seen, Inquiry chair Laura Sandys MP is adamant that further growth will be vital if the UK is to meet its carbon budgets, declaring that: “The question is now: how can the Government unlock the full potential of distributed generation? I welcome this report for tackling this timely and important question and for pointing to the way forward”

David Massingham, Director of Public Affairs at Covanta Energy who was part of the steering group during the inquiry, said::

“Distributed generation has an essential part to play in solving the UK’s energy dilemma. The government is obligated to reduce greenhouse gas emissions by 50% by 2027 and 80% by 2050 and electricity generation was accountable for 32% of carbon dioxide emissions in 2011. The UK needs to invest in alternative sources of power generation and move away from its reliance on fossil fuels.”

Stephen Barker, Head of Energy Efficiency and Environmental Care at Siemens, who also supported the report, said:

“One of the key industrial and economic challenges of our time is getting the issue of distributed generation right. It is essential there is a robust strategy to support this important gateway that will allow for the deployment of effective low carbon technologies of the future. There is also immense potential to grow and green our economy if we work together to develop these technologies to the fullest extent over the coming decade.”

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