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- UK Renewable Energy Market Report 2023
Stay ahead of the curve and future-proof your business with Mintel’s UK Renewable Energy Market Report 2023. Our full report is packed with consumer-led market intelligence, the latest UK renewable energy market research, trends and consumer behaviours affecting your business. Get a 360° view of the renewable energy market including market size, share and forecasted growth to help you align your business strategy with the needs of your audience.
Below, we’ve handpicked the key insights analysed in the full report and summarised the core topics.
Topics Analysed in this Report
- Developments and drivers across the key renewable energy market technologies.
- How government policies are impacting renewables deployment.
- The UK’s progress to move to a cleaner energy system.
- The future potential energy mix and demand.
Renewable Energy Market UK
While investment in renewable power has been growing strongly, the sector is facing headwinds from more expensive capital and cost inflation. The offshore wind sector, in particular, has been impacted by inflation and supply chain issues.
- UK renewable energy market size: The UK renewable energy market is worth £23 billion.
UK Renewable Energy Market Trends
Growth of the Solar PV Sector
Mintel anticipates strong annual growth in solar PV installations over the coming years, fuelled by a strong pipeline of approved large-scale solar farms, increased interest in self-generation and the decarbonisation agenda across the public.
- Renewable energy industry UK: Renewables accounted for 41.5% of total UK electricity generation in 2022.
Power of offshore wind
Electricity generation from offshore wind turbines is set to increase significantly to become a major contributor to UK electricity supply and will form the backbone of the UK’s net-zero electricity system.
- Renewable energy market growth: Offshore wind provided 13.8% of the UK’s electricity generation in 2022
Purchase our UK Renewable Energy Market Report to receive a five-year forecast, consumer behaviour analysis, and recommendations for market opportunities. Readers of this report may also be interested in our UK Sustainability in Technology Market Report 2023, or our range of Sustainability Market Research.
Companies Featured in the Full Report
Lightsource BP, Solar Energy UK, Anesco, Scottish Power, The Crown Estate, Offshore Wind Industry Council, Elgin Energy, WindEurope, Biogen, Tamar Energy, First Hydro Company, SSE, Vattenfall Wind Power, Vestas-Celtic Wind Technology.
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Expert Insights from a B2B Analyst
This report, written by Claudia Preedy, a leading research analyst, delivers in-depth commentary and analysis to highlight trends in the renewable energy market and add expert context to the numbers.
Significant investment is required to support renewables deployment and meet challenging decarbonisation targets, with most of this coming from the private sector. Creating a supportive and stable policy environment is imperative to attract investment.
Claudia Preedy
Senior B2B Analyst
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EXECUTIVE SUMMARY
- Opportunities for the renewable energy market
- Renewables capacity will need to increase dramatically over the next decade
- Solar PV sector offers strong growth opportunities
- UK is well positioned to become a global leader in floating wind technology
- Market dynamics and outlook
- The five year outlook for renewable energy
- Renewable electricity generation capacity
- Graph 1: renewable electricity generation cumulative installed capacity, by technology, 2018-23
- Growth in renewables deployment has slowed
- Renewables accounted for 41.5% of total UK electricity generation in 2022
- Graph 2: renewable electricity generation in the UK, by type of source, 2018-23
- Offshore wind provided 13.8% of the UK's electricity generation in 2022
- Solar PV's reinclusion in CfDs brings impetus to investment
- Significant investment in whole-system infrastructure required
- Electricity demand expected to show accelerated growth from 2030
- Graph 3: annual electricity demand, by scenario, 2022-50
- UK energy transition will push up electricity demand
-
UK ELECTRICITY GENERATION
- Overview
- 56% of UK electricity supply comes from low-carbon sources
- Graph 4: electricity generation by type of fuel used, 2012, 2018 and 2022
- Coal
- Gas
- Nuclear
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UK RENEWABLE ELECTRICITY Capacity AND Generation
- Overview
- Renewable electricity generation capacity
- Graph 5: renewable electricity generation cumulative installed capacity, by technology, 2017-23
- Offshore wind drives renewables deployment
- Graph 6: share of renewable electricity generation installed capacity by technology, 2016
- Graph 7: share of renewable electricity generation installed capacity by technology, 2023
- Rapid growth in renewables deployment…
- …but growth has diminished since 2015
- Annual renewable capacity additions in the UK
- Graph 8: annual renewable capacity additions, 2010-22
- Renewable electricity generation
- Electricity generated from renewable sources up by 10.5% in 2022
- Graph 9: renewable electricity generation in the UK, by type of source, 2018-23
- Wind power
- Wind accounts for 54% of installed renewable capacity
- Graph 10: onshore and offshore wind generation installed capacity, 2019-23
- Wind generation accounted for nearly a quarter of electricity generation in 2022
- Graph 11: wind energy electricity generation, 2018-23
- Development pipeline
- Graph 12: wind generation development pipeline, 2023
- Onshore wind: Overview
- Development of onshore wind farms has slowed significantly since 2015
- Onshore wind is one of the cheapest forms of electricity generation…
- …but has not been immune from rising costs
- Onshore wind re-included in CfD auctions
- Offshore wind: Overview
- The Crown Estates' leasing rounds for the development of offshore wind capacity
- UK is at the forefront of offshore wind globally
- RWE owns the greatest share of UK offshore wind farm capacity
- Graph 13: ownership of offshore wind farms (operational and under construction), by company, 2022
- The government's ambitious 50 GW of offshore wind capacity by 2030 target
- Offshore wind sees substantial cost reductions up to 2022…
- …but costs have risen sharply over the past year
- Turbine sizes continue to get bigger
- Turbine manufacturers are introducing ever larger, more efficient turbines
- UK is well positioned to become a global leader in floating wind technology
- Leasing for floating offshore wind
- Government support schemes for floating offshore wind
- Upgrading UK ports essential to enable scale-up of UK floating offshore wind sector
- Wave and tidal power
- UK wave energy installed capacity
- Graph 14: wave energy capacity and generation, 2019-23
- Development pipeline
- Graph 15: tidal barrage and tidal stream capacity in development pipeline, 2023
- Overview
- Tidal power's success in recent CfD auctions
- Key tidal stream projects
- Potential of Severn Estuary tidal energy
- Solar PV
- Introduction
- Installed capacity
- Solar PV electricity generation
- Graph 16: solar PV electricity generation, 2019-23
- Substantial development pipeline
- Graph 17: solar PV development pipeline, 2023
- Ground-mounted solar PV market
- Solar PV's reinclusion in CfDs brings impetus to investment
- Subsidy-free, large-scale solar PV market also takes off…
- …but market challenges remain
- Hydro power
- Overview
- Hydro energy capacity
- Graph 18: hydro energy installed capacity, 2019-23
- UK hydroelectricty generation
- Graph 19: hydroelectricity generation, 2018-22
- Hydroelectricity development pipeline
- Graph 20: hydroelectricity development pipeline, 2023
- Pumped storage hydroelectricity
- Potential of long-duration storage technologies
- UK pumped storage hydroelectricity pipeline
- Graph 21: pumped storage hydroelectricity development pipeline, 2023
- Bioenergy power generation
- Overview
- Ability of bioenergy with carbon capture and storage to generate negative emissions
- BECCS pilot schemes
- New business models required to support development of negative emissions market
- Bioenergy installed capacity
- Graph 22: bioenergy installed capacity, by technology, 2019-23
- UK bioenergy generation
- Graph 23: bioenergy electricity generation, by technology, 2018-23
- Bioenergy development pipeline
- Graph 24: bioenergy development pipeline, 2023
- Landfill gas
- Sewage sludge digestion
- Energy from waste
- Outlook for EfW capacity less certain
- EfW with CCUS
- Advanced conversion technology (ACT)
- Anaerobic digestion (AD)
- Green Gas Support Scheme provides positive impetus for AD sector
- Biomass
- Biomass's reliance on imports needs to be addressed
- Government's biomass strategy to prioritise carbon capture and storage
- Outlook for renewables deployment
- Renewables capacity will need to increase dramatically over the next decade
- Investor confidence in UK renewables sector slides
- Government's lack of long-term planning puts Net Zero target "in jeopardy", PAC warns
- Government needs to establish favourable conditions to attract investment
- Renewable electricity capacity development pipeline
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FUTURE ENERGY MIX AND DEMAND
- National Grid ESO's Future Energy Scenarios
- Introduction
- The four scenarios
- The four scenarios (cont.)
- Future electricity demand
- Electricity demand set to rise caused by electrification of transport and heating
- Graph 25: annual electricity demand, by scenario, 2022-50
- Rising power demand will require a range of solutions
- Consumer engagement to balance growing electricity demand
- The potential of Vehicle-to-Grid technology
- Future potential energy mix
- Renewables will drive new generation capacity additions
- Graph 26: projected installed electricity generation capacity (incl. storage and interconnectors), by scenario, 2022, 2030 and 2050
- Offshore wind
- Onshore wind
- Solar PV
- Unabated gas generation
- Low-carbon dispatchable power
- Nuclear
- Tidal power
- Bioenergy and BECCS
- Interconnectors
- Electricity storage capacity
- Low-carbon hydrogen supply
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ENERGY POLICY AND LEGISLATIVE ENVIRONMENT
- Government policy on reaching Net Zero by 2050
- Commitment to net zero target
- Government's legally binding carbon budgets
- Government off track to meet sixth carbon budget
- Net zero strategy
- Ambition to decarbonise the electricity system by 2035
- Government U-turn on some net zero policies
- The British Energy Security Strategy
- The Energy Security Strategy's low-carbon sources ambitions
- The Labour party's energy policy
- Labour's pledge to decarbonise the electricity system by 2030
- Policy instruments supporting decarbonisation of the electricity systems
- Renewables Obligation (RO)
- Contracts for Difference (CfD)
- New capacity secured in each CfD allocation round
- Graph 27: new capacity secured in each CfD allocation round, by technology, 2015-23
- Solar PV and onshore wind excluded from second and third CfD allocation rounds
- Onshore wind and solar PV reincluded in fourth allocation round
- A record 10.8 GW of renewable energy projects awarded CfDs in AR4
- Offshore wind becomes "established technology" in AR5
- 3.7 GW of renewable energy projects awarded CfDs in AR5, the lowest level since 2017
- Government raises maximum prices paid for offshore in AR6 to attract investment
- Feed-in Tariffs (FiTs)
- Smart Export Guarantee (SEG)
- Capacity Market (CM)
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MARKET DRIVERS
- Net Zero and decarbonisation
- Significant investment in whole-system infrastructure required…
- …to support the clean energy transition and new offshore wind capacity
- UK energy transition will push up electricity demand
- Emergence of a more flexible electricity system
- Overview
- Increased flexibility to be provided by storage, interconnection and demand-side response
- Batteries set to be a cornerstone of a smarter and more flexible system
- Trend towards co-located battery storage projects
- Hydrogen's potential contribution to Net Zero
- Government funding to support the commercial deployment of hydrogen
- But future role of hydrogen still uncertain
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COMPETITIVE LANDSCAPE
- Industry structure
- UK renewable energy market is worth £23 billion
- Graph 28: value of the renewable energy market, by technology, 2021-22
- Employment structure
- Graph 29: employment in the renewable energy industry, by sector, 2021-22
- Company profiles
- Biogen UK
- Recent company activity
- Financial information
- First Hydro Company
- Recent company activity
- Financial information
- Lightsource BP Renewable Energy Investment
- Business model and strategy
- Powerverse – the company's smart energy management system
- Financial information
- Scottish Power Renewables
- Recent company activity and outlook
- East Anglia offshore windfarms
- ScottishPower becomes major player in solar market through project acquisitions
- Financial information
- SSE
- Disposal of non-core assets to sharpen strategic focus around electricity infrastructure and net zero
- Renewables at core of SSE Group's business strategy
- Net Zero Acceleration Programme Plus
- Financial information
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APPENDIX
- Supplementary data
- UK electricity generation
- Renewable electricity generation
- Renewable energy projects in pipeline
- List of UK offshore wind farms
- List of UK offshore wind farms (cont.)
- Report scope and definitions
- Market definitions
- Abbreviations and terms
- Methodology
- B2B research methodology
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