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Growth in the UK’s low-carbon power generating capacity is set to fall behind all the other big global economies for the rest of the decade, according to new study.
Electricity output from renewables and nuclear in the UK is set to grow by an average 2.9 per cent per year between 2023 and 2030, research by the consultancy Oxford Economics found.
This is the slowest rate among the world’s eight largest economies, with India set to grow the fastest at 10.6 per cent, followed by China at 7.2 per cent, the US at 6.4 per cent, and Germany at 5.8 per cent.
Energy UK, the trade group that commissioned the research, said the findings underlined why the UK government needed to do more to support the renewables sector. It said the “downbeat forecast” reflected “low levels of expected investment in the UK” as rival countries including the US and China boost incentives for investors.
The release of the findings coincides with the first anniversary of US president Joe Biden signing into law the Inflation Reduction Act, which offers a $369bn package of support for US clean energy and climate projects.
The huge subsidy package has raised concerns in the UK renewables sector that it will be left behind as others, including China and the EU, respond with similar green investment programmes.
The UK government has also come under criticism from climate campaigners for signalling that it was prepared to water down its green commitments in the run-up to the next general election, which has to take place before January 2025.
“With growing global competition for private investment that can choose its location, a failure to respond will see us quickly fall behind and jeopardise ambitious targets for increasing our own sources of clean energy and decarbonising our whole economy,” said Emma Pinchbeck, chief executive of Energy UK.
The UK has long been one of the world leaders in removing fossil fuels from its power sector and is second only to France in terms of low carbon output from generation. Low carbon sources including wind, solar, biomass and nuclear accounted for 56.2 per cent of UK electricity generation last year.
Emily Gladstone, senior economist at Oxford Economics and one of the authors of the report, said this explained to some extent why the UK would fall behind as other economies catch up.
The study put France’s growth rate slightly ahead of the UK at 3.1 per cent, while Japan is forecast to grow at 3.2 per cent, and Italy at 5.2 per cent out to the end of the decade.
The UK government has set a target of 2035 to decarbonise the electricity system, as one step towards its net zero carbon emissions target by 2050.
Last month, Swedish wind developer Vattenfall halted plans for a new offshore wind farm off England’s east coast, saying rising costs meant it was no longer viable under the fixed electricity price it had agreed with the government.
Jess Ralston, head of energy at the Energy and Climate Intelligence Unit think-tank, warned that a “lack of clarity” from the government could see the UK fall behind in terms of green investment.
In a statement the government said: “We won’t apologise for moving faster and earlier on clean energy than many other countries,” adding: “We have already attracted around £120bn investment in renewables since 2010 . . . with a further £100 billion private sector investment across low carbon sectors expected by 2030.”