UK Accelerates Clean Energy to Protect Against Fossil Fuel Price Shocks

UK Ramps Up Clean Energy Efforts to Reduce Fossil Fuel Dependency and Price Risks

Government Initiatives to Accelerate Renewable Power and Lower Energy Costs

By Susanna Twidale

LONDON, April 21 (Reuters) - Britain will launch a package of measures on Tuesday to accelerate the growth of renewable power and reduce the country’s reliance on fossil fuels which have soared in cost due to the conflict in Iran, the government said.

The government said it will also announce steps to tackle the link between gas and electricity prices, a feature of the energy market that is blamed for Britain having some of the highest electricity prices in the world.

Britain's Labour government has said it sees the energy transition as a way to fuel much-needed economic growth, and is under pressure to meet an election pledge to cut energy costs for households.

Era of Fossil Fuel Security is Over

'ERA OF FOSSIL FUEL SECURITY IS OVER'

Government Perspective on Energy Transition

"As we face the second fossil fuel shock in less than five years, the lesson for our country is clear: The era of fossil fuel security is over, and the era of clean energy security must come of age,” Energy Secretary Ed Miliband will say at an event, according to sections of his speech released by his ministry.

Impact on Domestic Energy Prices

Domestic energy prices are poised to soar from July - as the regulator's price cap enters a new pricing quarter from July to September - due to surging wholesale gas costs, which are currently 30% higher than before the Iran conflict began.

Boosting Renewable Power Generation

Plans for Solar and Wind Expansion

The government will announce plans to boost renewable power generation such as solar panels and wind turbines on public land which it said could unlock up to 10 gigawatts of electricity, enough to power around 5 million homes.

Streamlining Rules and Grid Connections

It will look to streamline rules to make it easier to build renewable projects and connect them to the power grid and to explore ways to allow companies to build their own grid connections.

Facilitating Home Energy Solutions

It will also seek to make it easier for people to install electric vehicle chargers, solar panels and heat pumps at home.

Decoupling Electricity Prices from Gas

DECOUPLING ELECTRICITY PRICES FROM GAS

Government Strategy to Delink Prices

Miliband and finance minister Rachel Reeves will announce steps to "delink" the price of electricity from the price of gas, the government said, without going into more detail.

How Electricity Prices Are Set

The wholesale price is set every 30 minutes by the cost of the last energy source used to ensure demand is met. So even if wind, solar and nuclear provide 99% of the power needed, if gas-fired plants are needed to make up the last 1%, then gas sets the price for every buyer and seller.

Role of Gas-Fired Power Plants

Gas-fired power plants are the biggest single source of the country’s electricity, and can react quickly to demand, so end up setting the price most of the time.

(Reporting By Susanna Twidale; Editing by Andrew Heavens)