Background
The amount of intermittent generation connected to the grid is expected to increase significantly over the next couple of decades. This, alongside significant changes to the generation portfolio, is likely to have significant impact on the role and operation of all generation plant. There is likely to be an increased demand for ancillary services such as reserve, response and inertia whilst traditional providers retire from the market place. The project examined the entire market for ancillary services including the need to maintain firm capacity to provide security.
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The project undertook some modelling and analysis of the GB electricity system in the light of the carbon targets set by the Committee on Climate Change. Firstly a brief examination was made of the German and Irish markets with the hope of learning from their advanced penetration of variable renewables. Secondly a new model, BERIC, was written to simultaneously balance the need for energy, reserve, inertia and firm capacity on the system and its findings compared with simpler stacking against the load duration curve. The intention was to assess the need for flexibility on the system but some broader conclusions also emerged:
Conclusions
A system with weather dependent renewables needs companion low carbon technologies to provide firm capacity. This firm capacity could be supplied by a number of technologies such as nuclear, biomass or fossil CCS.
Policy makers and system operators need to value services that ensure grid stability so new providers feel a market pull. Currently some necessary services are provided free or as a mandatory service. However traditional providers (fossil plant) are disappearing at the same time that demand is growing. New providers can’t develop in the absence of a market signal.
A holistic approach to system cost would better recognise the importance of firm low carbon technologies and the cost of balancing the system. The value to the system of a technology is dependent on the existing generation mix and the services which that technology can provide. This means that a technology cannot be characterised by a single number such as levelised cost of energy.
Recommendations
A much deeper examination of the issues raised here is needed but must employ a whole systems approach.
New zero carbon firm capacity is essential to decarbonisation but leading technologies such as nuclear and CCS require long lead times so meeting 2030 targets requires action today.
DECC and National Grid should consider how new providers of ancillary services can be given the financial comfort needed to underpin their development and deployment before traditional providers disappear.
This work supports some key recommendations from the European Commission’s Smart Grid Task Force, in particular:
- Equal access to electricity markets for all providers
- Contractual simplicity and transparency
- Standardised measurement of flexibility
- Incentives to grid operators to enable flexibility for meeting 2030 targets rather than focussing on short-term optimisation
- Improved price signals for providers of flexibility
Follow-up activities
A workshop was held in November to test these initial conclusions. Further work and modifications to the modelling will take place in response to that. Talks have also been given to the 14th Annual APGTF Workshop, the Gas to Power UK Forum 2014 and the IChemE workshop at the Grantham Institute for Climate Change.
Working Group
Project Chair:
Peter Emery – Drax
Steering Group:
- Phil Lawton – National Grid
- Nick Bevan – DECC
- Nick Eraut – ETI
- Ed Sherman – BIS
- Alexandra Malone – SSE
Steering group advisor
Further Information
Please contact ERP .
Background
Community energy can be broadly defined as energy projects in which local residents and businesses have a shared stake and are the main intended beneficiaries. Community energy has the potential to engage local communities in energy matters, with the aim of bringing two main benefits for the low-carbon transition: acceptance of change, and engagement with energy. Projects can also be methods of delivering other benefits for communities. Motivations include political objectives, local priorities, and some consumers’ desire for more control of their energy affairs.
The Energy Research Partnership (ERP) has produced a discussion paper on community energy in the UK. The paper presents examples of community energy in the UK and other countries, highlighting the motivations, benefits, costs and risks, and identifying challenges that community energy faces in the UK. Those challenges are grouped into: assessing outcomes, deploying projects, and delivering benefits. The paper considers how to improve the assessment of projects, and to improve the understanding of the role of community energy in the UK in order to determine whether its net impacts (and their distribution) justify addressing the challenges that it faces.
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Conclusions & Recommendations
- There are examples from around the UK and from other countries in which community energy has delivered benefits in the energy sector (public acceptance of change, and engagement with energy), as well as wider social benefits for communities.
- There is a need for improved assessment of projects in the UK, and improved understanding of community energy’s role in the UK in order to determine whether its costs and benefits (and their distribution) justify addressing the challenges that it faces. We recommend:
- improving assessment of projects, and providing guidance for decision makers;
- facilitating studies by providers of technology and services; and
- conducting studies to review existing projects, monitor new projects, and trial alternative arrangements for local energy.
- There are opportunities in the short-term to increase the uptake of projects (including for conducting studies) and to improve the delivery of expected benefits. We recommend:
- provision of tailored advice to project groups; and
- provision of opportunities to delegate administrative tasks.
Follow-up activities
We will work in autumn 2015 with community energy support groups, policy makers and research funders to progress our recommendations, focusing on the proposed research.
Steering Group
Steering Group chair:
- Naomi Luhde-Thompson, Friends of the Earth
Steering Group:
- Anna Wieckowska, Hitachi
- Laura Morris, ETI
- Christian Inglis, Innovate UK
- Chris Noyce, ESRC
- Fiona Booth, DECC
- Ron Loveland, Welsh Government

Background
How energy is produced and used is expected to be transformed with the transition to a low-carbon energy system. This will have major impacts on how it is transferred from point of production to user, to ensure an economically efficient, secure and reliable supply of energy services. With supply and demand becoming increasingly variable, and potentially a shift towards greater electrification particularly at the household level, smarter systems will be need requiring new approaches and technologies to manage the networks. This is likely to affect how the transmission and distribution networks, particularly for electricity, are managed and monitored and greater demand-side controls along with smart meters.
Considerable effort has been put into understanding and coordinating the development of smart grids in the UK. However, as the technologies and understanding develops and evolves and with so many stakeholders involved, each with different interests, the definition of a smart grid can diverge. This project will review the current activity with the aim of understanding the various perspectives on smart systems, including the interaction between the gas and electricity systems and demand-side technologies. It will include understanding the perspectives of the various operators, with the aim of proposing a common language and identifying gaps in the research & development efforts.
Conclusions & Recommendations
ERP plans to publish a report from this work in early 2017.
Follow-up activities
TBC.
Steering Group
Project Chair
- Phil Sheppard, National Grid
Steering Group Members
- Duncan McCombie, Energy Savings Trust
- Damitha Adikaari, DECC
- Dave Openshaw, UK Power Networks
- Phil Proctor, Energy Technology Institute
- Nick Smailes, Technology Strategy Board
- Ron Loveland, Energy adviser to Welsh Government
- Ewen Cameron, Scottish Enterprise
- Gareth Evans, Ofgem
- Peter Jones, ABB
Further Information
Please contact Richard Heap from the ERP Analysis Team.

Interconnected World
Background
Development of energy technologies that can significantly reduce global carbon emissions will require an international effort. Initiatives from the EU, IEA and G8 demand that the UK take a strategic approach in involvement in international activities, which should include public and private sectors.
Aims
For each technology area there are 3 categories of international engagement beneficial to the UK:
1) The UK leads and there is an export opportunity
2) The UK is on a par and needs to work with peers to develop a technology
3) The UK is behind but requires the technology
The primary aim of this work is to provide guidance for high-level visits to other countries, so that the agendas pursued and agreements signed are in the UK’s interests according to the category of engagement sought. Output will therefore be in the form of a living document. It will contain guidelines specific to technologies and potential partner countries, useful to anyone involved in international activity anywhere along the innovation chain. Initially the ERP will be an appropriate and neutral home for this.
Secondly the aim is to provide guidance to technology experts on the location of the main hotspots for key low carbon technologies.
Connections with other work
The Technology Innovation Needs Assesments (TINAs)s, commissioned by the Low Carbon Innovation Co-odrination Group (LCICG), are forming a good starting point to this work, although not all areas are covered. DECC are carrying out some work in this area and Innovate UK (Brussels Office) have made some assessments also. These works will be key to ensuring there’s no repetition of effort.
Steering Group
Currently Innovate UK, Welsh Government & DECC, but further input is sought, especially from ERP’s Industrial Members.
Background
Existing works on low carbon pathways and policies have focused on ‘the energy trilemma’: cost of energy, security of supply and carbon emissions, often with a significant emphasis on cost effectiveness. In particular, importance has been placed on achieving the lowest costs in the short-term, with decreasing costs in the long-term.
An area that has been relatively neglected within the development of pathways and scenarios (and related models) is the value and impact of pathways on economic growth (measured in GDP/GVA) and analysis of other socio-economic effects, including at regional levels. Reasons for this relate to current modelling interests and capabilities, and a lack of existing ‘top-down’ or ‘spatial’ models utilised within the UK.
It is well known and accepted that economic and socio-economic impacts can be intangible and complex to measure and define, but there are some existing UK models that can and do assess them.
ERP’s paper addresses the issue of how the UK currently considers and assesses economic impacts and benefits within five of the UK’s major pathway and scenario works. It additionally considers modelling capabilities (now and in future) and highlights other relevant models or works that can assist with analysis in this area. Works assessed within the paper are: 1) CCC’s 4th Carbon Budget Review, 2) DECC’s 2050 Pathways/Calculator & Analysis (with some extra consideration of the Dynamic Dispatch (DDM) model), 3) ETI’s ESME model, 4) National Grid’s Future Energy Scenarios (RESOM model) and 5) the MARKAL ELASTIC DEMAND model used to inform two of UKERC’s Energy 2050 scenario works. The work additionally considers the MARKAL-MACRO and Cambridge Econometrics’ MDM-E3 models.
The paper concludes by making recommendations for how further analysis of economic and socio-economic impacts can be carried out – by utilising appropriate modelling capabilities (existing and new), to help inform policy from both a top-down and bottom-up perspective of the energy system.
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This project:
- Provides a broad overview of how the UK currently considers and assesses economic impacts and benefits within some of its major pathway and scenario works.
- Checks for consistency in the use of these approaches across relevant scenarios and reports.
- Considers modelling capabilities (now and in future) for making these assessments and highlights other relevant models and works that can assist with analysis in this area.
- Provides a summary of key findings and recommendations for potential future work to be taken forward by other organisations/departments.
Key Messages
- Assessments of economic growth and job creation within low carbon pathways have been relatively neglected, although it is accepted that these are complex to measure and define. Current modelling types and approaches tend to focus on 1) cost-optimisation and 2) achieving the carbon targets. There is also a lack of clarity regarding input assumptions used.
- Many works are not designed to make these assessments (it is not within their remit) and incorporating this type of analysis within the models assessed is seen as unfeasible. Impacts on a regional level within the UK (Scotland, England, Wales etc.) are complex to capture and are therefore rarely assessed.
- The type and limited number of macro-economic ‘top-down’ energy models being utilised currently constrains the range and reliability of assessments informing policy. Although these models exist (e.g. the Cambridge Econometrics’ MDM-E3), many are not set up to assess the economic value of low carbon pathways and the range of economic and socio-economic impacts of interest to policy-makers.
- There is a level of uncertainty regarding current and future modelling capabilities (models are designed for a specific purpose and are not always adapted) and a range of opinions as to whether these assessments should be included within pathway and scenario works.
Recommendations
This study has looked at a variety of models and criteria used to make judgements about future low carbon pathways and potential benefits to the UK. It is clear that further work is required to better understand the full range of models available in government, industry and academia to support this assessment, their limitations and how they interact with whole economy models. Recommendations therefore include:
- Further investigation is required to consider how and whether models can be used for more in depth socioeconomic assessments;
- The integration of existing model types should be considered, to enable more socioeconomic analysis and inform policy at a more strategic level.
- Clear communication and transparency regarding the design, premise and limitations of modelling works should be encouraged to avoid the risks of misinforming policy e.g. the effect of economic input assumptions on results obtained.
- Continued and more detailed work to assess the impacts and benefits of specific technologies for GDP, job creation and investment opportunities is encouraged, including at regional levels.
- Analysis of economic growth and job creation should be included as part of, or alongside pathway and scenario works wherever possible. This may involve an additional element of secondary analysis.
- Greater funding support is required for the development of these model types – to improve the quality of outputs and understanding of their potential.
A full list of recommendations and associated ‘Next Steps’ can be found in the Summary Paper and Final Report.
Steering Group
- Chris Pook (BIS) – Steering Group Chair
- Tom Delay (The Carbon Trust)
- Rob Saunders (TSB)
- Will Lecky/Adam Harmon (DECC)
- Emma Edworthy (Welsh Government)
- James Bolton / Aftab Malik (BIS)
- Kenny Richmond (Scottish Enterprise)
- Eric Ling (CCC)
Background
Over the next 40 years, analysis suggests that investment in energy innovation could reduce the cost of meeting the UK’s low carbon energy goals by £600 bn. These savings would reduce the upward trend in energy costs across the economy making the UK more competitive. Furthermore, energy technology development could result in UK business opportunities totalling at least £18 bn to 99 bn to 2050.
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However, recent surveys have identified that some UK executives, particularly those in the manufacturing sector, are concerned about the availability of metal mineral resource inputs and the economic impact that it may have on UK competitiveness – potentially jeopardising energy goals and green growth opportunities. The Energy Research Partnership (ERP) has undertaken a review of mineral resources in order to assess whether resource availability will represent a significant risk for UK energy innovation and system development to 2050; it was undertaken with UKERC’s work on Minerals Availability. The review has highlighted the following key issues regarding the availability of metal minerals:
- Resources concerns are not a new phenomenon. Recent concerns have been stoked by the rapid rate of growth of emerging economies and ecological impacts of resource consumption.
- Energy systems are increasingly dependent on metal minerals as a result of the proliferation in the use of exotic elements and the increased mineral intensity of new energy technologies; many are essential in the development of the low carbon energy system to 2050. Consideration of primary supply of minerals is important in the near term, not only because of the expansion of energy systems but also because the long lifetime of assets means that minerals are `locked-in’, unavailable for recycling for many years. Recovery and recycling, however, are likely to be critical and should be taken into account in current decisions.
Project
This project was given the go-ahead at ERP’s April 2012 Plenary meeting. A Steering Group initiation meeting took place in mid-2012 with a view to producing preliminary findings and a final report (a joint ERP-UKERC publication) in late 2014.
The report has now been released with a summary policy paper and a full policy paper available to view.
Conclusions and recommendations
The key messages from the review are:
- The most potentially significant metal minerals constraint risk to UK energy innovation and system development to 2050 may be posed by the volatility in price and potential disruptions to the availability of `technology metal minerals’ used in both conventional energy generation and low carbon technologies. Supply uncertainty is the key concern. The availability of technology metal minerals at reasonable economic costs is essential to facilitate the rapid commercialisation of the low carbon energy system.
- Although there is no absolute shortage of any metal mineral resources, absolute availability is not a meaningful guide to prospective future production and availability, because of the impacts of economics and geopolitics. The key constraints are related to the volatility of price and potential supply disruptions. The uncertain abilities of ecological sinks to assimilate anthropogenic generated waste from the exploitation and processing of metal minerals are likely to present further challenges.
- Resource risk assessments require a system based perspective, especially of supply and demand side issues in order to account for market dynamics and ensure the development of appropriate policy responses. There is a concern that some metal mineral assessment tools are likely to lead to inadequate and miss-directed policy responses.
- The impact of metal minerals non-availability on the UK economy has yet to be quantified, and is likely to be similar to other mineral consuming nations. However, the UK’s response to the issue has tended to be non-interventionist. This is in contrast to proactive initiatives that other governments are taking, particularly in the securing of upstream supply and funding research into developing secondary sources. In the long run, the UK is therefore likely to be at a comparative disadvantage and should markets remain tight, the ability to develop a high value manufacturing sector could be jeopardized and the value creation opportunities of implementing mineral security measures will be missed e.g. material efficiency through better design, reuse and recycling technology development.
With these in mind, the ERP makes the following recommendations to ensure the UK has a globally competitive energy innovation sector:
- The location of responsibility for the monitoring of metals mineral non-availability risk and opportunities should be better defined in government.
- Resources risk assessments require a more holistic perspective of supply and demand side issues, on a mineral by mineral basis, in order to account for market dynamics and ensure the development of appropriate policy.
- Market transparency and the needs of upstream supply actors should be a priority. Transparency measures include the development of awareness of minerals use in energy technologies, impacts of minerals policies enacted by supplier nations, improved datasets and more open pricing mechanisms should be encouraged when there is sufficient liquidity. Primary supply initiatives include increasing the availability of risk capital for Junior miners exploration operations in unstable regions and encouraging investment and R&D in refining capacity.
- Investment into recycling, materials efficiency and substitution research initiatives should be improved and co-ordinated with the UK manufacturing and design sector – with immediate attention on design for recovery and recycling. Awareness of the impacts of the interaction of these policies needs to be researched.
Follow-up activities
TBA
Working Group
Project Chair: Martin Grant – Atkins
Project Steering Group:
- Richard Neale -Atkins
- Ian Glover -National Grid
- Simon Cox -Defra
- Rebecca Heaton -Shell International
- Duncan McLaren – Friends of the Earth
- Cameron Rennie – BP
- John Miles – Arup
- Chris Franklin – Research Councils (NERC)
- Jocelyn Bleriot – Ellen MacArthur Foundation
- Simon Schillebeeckx- Imperial Business School
It is clear that the public have a significant role in determining how the transformation of the energy system progresses. While largely supportive of a sustainable energy system the public’s trust in energy companies and government to deliver it is currently low. Published in May 2014, ERP’s ‘Engaging the Public in the Transformation of the Energy System’ report looks at how to restore this trust, which is vital if the public is to be expected to engage in the transformation, both in terms of informing decision making and undertaking changes at an individual level.

Background
For the UK to meet its mid- and long-term policy targets of a secure, low-carbon and affordable energy system a considerable transformation will be needed, requiring new technologies to be deployed along with changes to the way energy is used, distributed and generated. Spanning several decades there are still considerable uncertainties about how this will develop. It is clear that the public will interact with these changes at several levels: whether in deployment of new infrastructure or technologies in the home, or changes in behaviour. Involving the public is therefore essential, but understanding how and why is vital to ensure the transformation to a sustainable energy system is acceptable and successful.
Conclusions & Recommendations
The report explores the strategic importance of engaging with the public and the need for those involved in commissioning it, including in government and the private sector, to use it to improve decision making in the delivery of the energy transition. The value of understanding the publics’ point of view through good, early engagement is emphasised and a structure for engagement is set out with some key principles to improve the outcomes.
The work recommends developing a Strategic Narrative that can put into context the various programmes necessary for delivering the energy transition. Developed through early engagement with the public and stakeholders involved in the transition, this Strategic Narrative would help build trust and understanding of the long-term objectives and in those parties involved in delivering them and would also increase the amount and quality of engagement.
Follow-up activities
Narratives are recognised as being effective communication tools particularly for complex issues. For an issue that is as broad, complex and multi-faceted as the transformation of the energy system a high-level narrative is needed to provide a come shared purpose and demonstrate coherence to the various activities and policies needed to achieve it. Engaging the public is vital to help identify the key components of the Strategic Narrative.
ERP held a workshop in July 2014 to develop the process for developing a Strategic Narrative, with the help of Dialogue by Design and Involve. We are looking at holding a further workshop to explore the issue further in 2015.
Steering Group
The report was prepared by the ERP Analysis Team, led by Richard Heap.
ERP initiated this project recognising the importance of engaging with the public in the transition to a sustainable energy system. The work has been informed by a series of interviews and a workshop that brought together representatives from academia, industry, NGOs and the public sector. This workshop helped identify areas that are important for effective public engagement. Details can be found on the link above.
- Steering Group Chair: Ron Loveland (Welsh Government)
- John Loughhead (UKERC)
- Duncan McLaren (Friends of the Earth)
- Peter Snowdon (Shell International)
- Meryl Hicks (BP)(to Feb 2014)
- Janine Freeman (National Grid) (from Jan 2014)
- Adam Cooper (formerly DECC) (until Sept 2013)
- Ewan Bennie (DECC) (from Jan 2014)
Further Information
Please contact Richard Heap from the ERP Analysis Team.