Industry in focus: green energy

With many nations racing to achieve ambitious Net Zero targets, energy uncertainty increasing due to the war in Ukraine and climate change fears becoming more pronounced, the green energy industry has never been as important to the UK as it is today.

How much renewable energy does the UK produce?

According to government data, the amount of renewable energy generated in Great Britain has increased substantially over the course of the last decade. Official figures from the Department for Energy Security claim energy from renewables has leaped from 6.7% in 2010 to over 41% by 2022[1].

The UK was an early adopter of renewables but, has been overshadowed in recent years by its closest neighbours. The Energy Studies Institute at Singapore University calculates that 45% of European countries now have a greater renewable energy capacity than the UK, which currently sits at just under 50%.

Despite this, there are encouraging signs with the World Economic Forum describing 2022 as a ‘record-breaking year for renewable energy in the UK’. Around 40% of total energy used that year came from renewable sources, including solar, wind, hydro and biomass.

Enormous growth is forecast

Massive investment is being made in this critical industry. Mordor Research suggests that market size will grow from 134.85 gigawatts in 2023 to 217.57 gigawatts in 2028. That equates to a CAGR of 10.04%.

Additional energy from wind will be one of the key sources of this growth. With plentiful supply of this natural source of energy, wind energy capability has grown consistently over the last few years and is expected to rise further; from 48.49 GW in 2021 to 52.42 GW in 2022. The amount of electricity generated from wind scaled up by 715% in the period 2009 – 2020.

There are several notable offshore wind energy projects in the works too, with both BP and Scottish Power developing floating offshore wind farms, so we can expect these figures to continue rising.

Increasing green energy infrastructure and capability is a key priority for the UK – it’s not only necessary to cut the rapidly increasing cost of energy to power our homes and businesses, it could also be a lucrative source of income for the nation. The Russian invasion of Ukraine undermined global energy security, with much of the EU’s energy coming through Russia and Ukraine. Sanctions and infrastructure damage have created huge uncertainty – but with that uncertainty comes an opportunity for the UK to increase its exports of renewable energy.

Employment

Around 247,000 people are currently employed in the renewables industry in the UK, according to the Office of National Statistics

What challenges exist?

As we have seen, many EU countries, along with the USA, are making major strides forward in their renewable energy investments, meaning the UK needs to act quickly to keep pace. Frequent criticisms include a lack of favourable government policy and the need to scale up investment. The non-profit trade association Renewable UK has called for the government to publish a comprehensive renewable strategy in order to attract greater international investment to the sector.

The government counters that as an early adopter, other countries are simply catching up. The Department for Energy Security says that £120bn in investment has poured into the sector since 2010, with an additional £100bn on the cards between now and 2030.

[1] Source: https://www.theguardian.com/environment/2023/aug/11/uk-renewable-energy-investment-lagging-behind-rest-world-data#:~:text=In%20the%20UK%2C%20total%20renewable,in%20the%20last%20three%20years.