Does Government Really Expect 24% of UK Electricity to be Imported in 2025?
New UK government projections of capacity and supply suggest that interconnection and electricity imports must grow by over 300% by 2025 if demand is to be met. While imports are not in themselves to be feared, it is worrying that government appears to be using assumptions about interconnection as a free parameter to paper over deficiencies in what is now in effect a centrally planned electricity system.
The GB system currently has about 5.7 GW of interconnectors, and in 2016 net imports of electricity over these lines amounted to about 18 TWh, mostly from France, and the Netherlands, though with traces from Eire and Northern Ireland. This is approximately 6.5% of demand on the GB system.
Data published last week by the Department of Business, Energy, and Industrial Strategy (BEIS) as part of the latest iteration of its Updated Energy Emissions Projections shows that interconnection must rise to 20 GW as soon as 2024, and net imports must rise to 77 TWh in the following year, 24% of requirements, if expected demand for electricity is to be met.
BEIS’s own chart (5.1 in the UEEP itself) is not particularly helpful in appreciating the overall picture, so I here redraw that data in two figures, the first showing electrical energy generation in terawatt hours by fuel type from 2016 to 2035, and the second re-expressing that data in percentage terms.
Figure 1. UK Electricity Generation (TWh) from 2016 to 2035. Source: Department of Business, Energy and Industrial Strategy, Updated Energy and Emissions Projections 2016 (March 2017). See Web Figures.
The salient facts are:
- The quantity of electrical generated from gas-fired generators is expected to fall sharply in 2017, and to decline, though with some short term increases, thereafter.
- Nuclear output is expected to expand significantly after 2025.
- Renewable output roughly doubles over the period.
- Imports grow very sharply in the middle of the next decade, and then decline in volume towards the end of the period.
The percentages bring this into sharper focus:
Figure 2: UK Electricity Generation (%) from 2016 to 2035. Source: Department of Business, Energy and Industrial Strategy, Updated Energy and Emissions Projections 2016 (March 2017). See Web Figures.
As can be seen in 2025 the UK is nearly 25% reliant on imported electricity in spite of renewables contributing upwards of 35% of demand in that year.
The evolution of generating capacity behind this phenomenon can also be charted from BEIS’ projections:
Figure 3. UK Electricity Capacity 2016 to 2035 (GW). Source: Department of Business, Energy and Industrial Strategy, Updated Energy and Emissions Projections 2016 (March 2017). See Annex L: Total Electricity Generating Capacity.
The salient features of this chart are:
- Total capacity increases by about 40% in the period.
- Natural gas capacity does not grow significantly, indeed it falls from a peak in 2018 of 39 GW to 31 GW in 2035.
- Nuclear capacity declines to a low of 5 GW in 2024 and then climbs to 17 GW in 2035.
- Renewables grow steadily from 37 GW in 2016 to 63 GW in 2035. This is by no means implausible; the government’s own Renewable Energy Planning Database, records 55.2 GW of consented renewable capacity.
- Interconnection rises rapidly from about 6 GW in 2016 to 20 GW in 2024.
The rapid, major increase in import capacity and in electricity imports is far and away the most important single feature of these charts, and not, it must be emphasised, because imports are to be feared in themselves, but because of what this tells us about the way that BEIS has constructed the estimates. In many circumstances imports are to be welcomed, as economic, but the BEIS projections have little or nothing to do with comparative advantage. They are not grounded in economic analyses suggesting that within a few years it will be the best use of resources for UK consumers to buy over 20% of their electricity from overseas suppliers. On the contrary, it seems clear that what BEIS has done is use imports simply as a free parameter. Where their models of new generation and output fail to meet projected demand they have assumed that imports will make up the balance. That is why the net imports fade away both in absolute quantity and in proportion after the mid-2020s, when new nuclear generation starts to be built
In one sense we can take comfort from the fact that these are not realistic scenarios; importing in distressed circumstances is clearly not an attractive prospect, and BEIS itself remarks that “The results do not indicate a preferred alternative and should be treated as illustrative” (UEEP, p. 31). But illustrative of what? Departmental despair? It is, at the very least, disconcerting to learn that in spite of having assumed all but complete responsibility for the supply of electricity the UK government has in 2017 little or no idea how it is going to meet demand in the early and mid 2020s other than ad hoc assumptions with regard to imports of electricity over interconnectors the vast majority of which are not yet built and from markets that may not be able, let alone willing to supply the UK’s needs.