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2020 and beyond: what we know so far

When you’re trying to keep up with the constant changes that take place in the energy industry, it can be difficult to take a long-term view. However, it’s wise to stay ahead of the curve as much as possible in order to future-proof your business’ energy strategy.

With that in mind, we’re taking a look at the energy events we already know that we can expect in the coming decades. By 2020, Britain will have left the EU (or at least be in a 2-year transition process of leaving) and we’ll have seen the implementation of a number of changes within the energy industry, from the new reporting scheme for large businesses to the new DUoS (and probably TNUoS) charging structures.

From 2020 and beyond, energy managers will need to be prepared for the following…

Targets to be met…

Those operating in the public and high education sector should be aware of the voluntary target of a 30% reduction in carbon emissions by 2020-21 (based on 2009/10 levels) that the Government announced in the Clean Growth Strategy. They will undertake a progress review in 2020, with a view to setting a more ambitious target during the 2020s, which could be as high as a 50% reduction by 2030.

2020 is also the year set for the UK to meet several other key renewable energy targets – it’s the year that the Government have pledged to source 15% of all of the UK’s energy from renewables. This includes 30% of electricity, 12% of heat and 10% of transport fuels coming from renewable sources. To ensure that we can achieve these targets, the Government have also committed to installing 10GW of offshore wind by 2020.

Whilst the progress in renewable electricity is good, the targets for renewable heat are likely to be much harder to achieve. For transport, we are now at the front of a wave of investment in electric vehicles and Energy managers shouldn’t under-estimate the impact this will have on individual sites and all distribution networks around the UK.

We can expect these targets to increase and new targets to be set over the coming decades, as we are also committed to reducing our emissions by 80% of 1990 levels by 2050 under the Climate Change Act.

To change…

While the Minimum Energy Efficiency Standards (MEES) will kick in for all non-domestic landlords in England and Wales in April 2018, it will be extended to all rented property – even when an existing lease is in place – by April 2023. If your site’s energy efficiency rating doesn’t carry a D or E rating, you will need to act now to improve it in time for the April deadline – find out more here.

With the Climate Change Levy (CCL) set to rise from 2019, to recover the revenue lost from the scrapping of the Carbon Reduction Commitment (CRC), the Government are also aiming to rebalance CCL rates for different fuel types by 2025. They’re aiming to reach parity between levies for gas and electricity to encourage a reduction in gas use in line with the UK’s climate change targets.

We can also expect another general election by 2022 at the latest, although it’s not unreasonable to think that we could be called to vote sooner than this. If the ruling party changes, we could see significant changes to our energy policy, as the major political parties have very different views on the right strategy for the future of Britain’s energy.

To be on the way out…

As part of the Industrial Emissions Directive, we’ll see the gradual closure of fossil fuel plants. We’ve seen the number of coal power stations reduce in recent years, with the Rugeley, Ferrybridge and Longannet power stations all closing in 2016. After 2025, we will have phased coal out of all of our electricity generation as we strive to meet our low carbon commitments. In contrast, we’re likely to see new nuclear come online in the form of Hinkley Point C, which is designed to provide 7% of our total energy needs for the next 60 years and is expected to come online in 2027.

Need help in planning ahead?

For an at-a-glance view of what’s coming up in the energy industry between now and 2050, check out our ‘2020 and beyond’ timeline (right).

We know it can be difficult to plan so far ahead when you’re busy with your day-to-day business activities, and we’re on hand to help you create an energy strategy that will work for your business, now and in the future.

To talk to one of our experts, call 08451 46 36 26 or email