I enjoyed the discussion at today’s Scottish Renewables hashtag#onshorewind23 conference “Pounds and Pylons” session. I thought I’d share my key slides for those interested. They highlight the potential size of the gap between Scottish renewable supply and the ability to do something with today and in the future it if we don’t get a better handle on strategic electricity system planning.
That includes moving forward with transmission as fast as possible, planning beyond the timescale and scope of the current Holistic Network Design (HND), expanding Ofgem’s Accelerated Strategic Transmission Investment Framework (ASTI). But it also means a properly whole system plan for electricity including storage, hydrogen electrolysis, demand flexibility and interconnection.
Thank you to Giles Scott for highlighting a small silver lining in the PMs speech yesterday prioritizing (1) energy spatial planning, (2) a fast track for national significant transmission infrastructure and (3) a new approach to grid connection (although, of course, that does not excuse his dismantling of core aspects of wider energy system decarbonisation – transport and heat – that were the real nub of that speech).
Today’s discussion also tackled market reform and CfDs including the success of onshore Scottish wind in AR5, but the big hole created by the failure to attract any bids offshore wind.
On aspect of current market arrangements that I was particularly interested in and wasn’t aware of before today came from Kristina Rabecaite who highlighted the increase in the size of risk premiums in wind PPAs during the price crisis: previously these risk premia were typically a few £/MWh pre price crisis but rose to more than £100/MWh on certain days and, like the energy price, are now settling at a significantly highly level that pre-crise . This is created by the unsymmetric balance risk taken by PPA offtakers with much larger downside risks (i.e. potential costs to the offtaker) than upside risks – I hope I have got that right Kristina.
Thanks for chairing a great session Lynette Purves, the fantastic discussion with the panel members including Randall Linfoot and Simone Giacche` as well as those mentioned above. And interested questions from Logan Black on CfD design and George Baxter on storage and others.