2021
9
UK Renewable Energy Market Report 2021
2021-10-30T04:16:14+01:00
OX1049121
1495
144028
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Report
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“While the UK has made good progress on decarbonising the UK electricity supply sector, significant investment in the whole system infrastructure will be required over the coming decade in order…

UK Renewable Energy Market Report 2021

£ 1,495 (Excl.Tax)

Description

The UK Renewable Energy report identifies consumer attitudes towards renewable energy sector, potential energy mix and demand, and cleaner energy systems in the UK. This market report covers the market size, market forecast, market segmentation and industry trends for the Renewable Energy market in the UK. 

Current Market Landscape

The renewable energy sector has proved relatively resilient during the COVID-19 crisis, although global supply chain disruptions and rising material costs due to the pandemic continue to pose challenges and cause delays to some projects.

  • Renewables’ share of total electricity generation reaching 43% in 2020, up from 36% in 2019.
  • Wind alone provided a record 24% of the UK’s electricity in 2020 – 13% from offshore wind and 11% from onshore wind.

For the first time ever, renewable technologies generated more electricity than fossil fuels in 2020, with wind power being the primary factor in driving the record share of generation.

Future Market Trends in Renewable Energy 

While the renewable energy market is resilient and set for strong growth, it continues to be stifled by a lack of consistent, proactive, and long-term support from the government. The Committee on Climate Change (CCC), the government’s advisor on its climate change strategy, stresses that the pace of policy development must accelerate to support to route to net zero. Credible policies should be fully functioning and properly funded by the end of the current Parliament to ensure that almost all investments are low carbon by the end of the decade or soon after.

Offshore wind is set to remain the most buoyant sector over the current decade, reflected in unprecedented investor interest and record prices in the Crown Estate’s Round Four Offshore Wind Leasing auction for sites in waters and England and Wales in February 2021. The renewable energy industry and overall sector has been buoyed by the launch of the Offshore Wind Sector Deal in March 2019 and a new ambitious government target of 40GW installed offshore wind by 2030.

Read on to discover more details or take a look at all of our UK Industrial market research.

Quickly understand

  • The impact of COVID-19 on the renewable energy sector.
  • The UK’s progress to move to a cleaner energy system.
  • The future potential energy mix and demand.
  • Key developments across the renewables sector.

Covered in this report

Energy Types: Coal, oil, gas, nuclear, hydro, wind (offshore, onshore), solar, bio-energy, pumped storage, biogas (from anaerobic digestion), biomass, hydroelectric, tidal power, wind power, Photovoltaic (PV) cells, landfill gas, sewage gas, wave power, interconnectors, BECCS, hydrogen, fossil fuel, gas CCUS.

Brands: RenewableUK, Lightsource BP, Statkraft (Solarcentury), Iberdrola Renovables, Siemens Gamesa Renewable Energy, Biogen (UK), First Hydro Company, ScottishPower Renewables, SSE, Vattenfall Wind Power, Vestas-Celtic Wind Technology.

Expert analysis from a specialist in the field

This report, written by Claudia Preedy, a leading analyst in the Industrial sector, delivers in-depth commentary and analysis to highlight current trends and add expert context to the numbers.

While the UK has made good progress on decarbonising the UK electricity supply sector, significant investment in the whole system infrastructure will be required over the coming decade in order to progress towards net zero while ensuring security of supply.
This will entail increasing the role of renewables (predominately wind and solar PV) and possibly nuclear, and decarbonising dispatchable generation via CCS [carbon capture and storage] and/or hydrogen. In order to accommodate high levels of renewables, demand will also need to become increasingly flexible, which will require improvements in system flexibility from storage, interconnection and demand-side response (eg through time-of-use electricity tariffs, V2G technology, etc).

Claudia Preedy
Senior B2B analyst

Table of Contents

  1. Overview

    • Key issues covered in this Report
    • COVID-19: market context
    • Economic and other assumptions
    • Covered in this Report
  2. Executive Summary

    • Impact of COVID-19 on renewable energy
      • Figure 1: Short-, medium- and long-term impact of COVID-19 on renewable energy, 2020-25
    • The market
    • Renewables provide more electricity than fossil fuels for the first year ever in 2020
      • Figure 2: UK renewable penetration of electricity generation, 2016-21
    • UK renewables installed capacity dominated by wind
      • Figure 3: UK renewable energy market shares, by installed capacity, 2016 and 2021
    • Offshore wind to dominate the upcoming CfD auction, which will be the largest yet
    • Subsidy-free, large-scale solar PV market takes off
    • Companies and brands
    • Investment in UK offshore wind manufacturing sector is being ramped up
    • Major UK solar developers seek acquisition and partnerships to accelerate growth
  3. Issues and Insights

    • Net zero ambitions drive fundamental change across the energy sector
    • Energy storage will play a key role in the transition to a clean electricity supply system
  4. The Market – Key Takeaways

    • Renewables provide more electricity than fossil fuels for the first year ever in 2020
    • Offshore wind to dominate the upcoming CfD auction, which will be the largest yet
    • Offshore wind costs are plunging ahead of expectations
    • Subsidy-free, large-scale solar PV market takes off
    • A more flexible electricity system will be required to offset the intermittency impact of renewables and ensure security of supply
  5. UK Electricity Generation

    • Overview
      • Figure 4: Analysis of electricity generation in the UK, by type of fuel used, 2016-20
      • Figure 5: Proportional importance of fuel source in UK electricity generation, 2016 and 2020
      • Figure 6: Proportional importance of fuel source in UK electricity generation, 2021
  6. UK Renewables Generation

    • The impact of COVID-19 on the renewable energy sector
      • Figure 7: Short-, medium- and long-term impact of COVID-19 on renewable energy, 2020-25
    • Electricity generation from renewable sources
    • Renewables generated more electricity than fossil fuels for the first year ever in 2020
      • Figure 8: Renewable electricity generation in the UK, 2016-20
      • Figure 9: Share of renewable energy installed capacity by technology, MW and %, 2016 and 2021
    • The rate of new renewables capacity has fallen since 2015
      • Figure 10: Annual growth in renewable capacity in the UK, 2010-20
    • The UK renewables sector offers strong investment and deployment opportunities
  7. Wind Generation

    • Overview
      • Figure 11: UK onshore and offshore wind energy generation capacity, MW and %, 2016 and 2021
    • Onshore wind
    • Onshore wind will be included in the upcoming CfD auction for the first time since 2015
    • Onshore wind is one of the cheapest forms of electricity generation
    • Offshore wind
    • The UK is the world leader in offshore wind
    • UK’s offshore wind capacity target raised to 40GW by 2030
    • Offshore wind prices are plunging ahead of expectations
    • Offshore wind farms and turbine sizes continue to get bigger
    • Floating offshore wind market set for take off
    • Wind generation capacity and generation
      • Figure 12: UK wind energy capacity, 2016-21
      • Figure 13: UK wind energy generation, 2016-21
      • Figure 14: UK wind generation development pipeline, 2021
  8. Shoreline Wave/Tidal Generation

    • The Crown Estate licenses wave and tidal sites to help unlock opportunities
    • Government rejects plan for £1.3bn Swansea Bay tidal lagoon
    • Just 22MW of wave energy capacity installed to date
      • Figure 15: UK wave energy capacity and generation, 2016-21
      • Figure 16: UK tidal barrage and tidal stream capacity in development pipeline, June 2021
  9. Photovoltaic Generation

    • UK-installed solar PV capacity reaches 13.5GW, according to official statistics
    • But actual deployment is higher as government data fails to capture subsidy-free schemes
      • Figure 17: Photovoltaic installations in the UK, 2015-21
      • Figure 18: Photovoltaic installations in the UK, 2013-20
    • Subsidy-free, large-scale solar PV market takes off
    • UK solar PV market set for sustained growth
      • Figure 19: UK photovoltaic development pipeline, 2021
  10. Hydro Generation

      • Figure 20: UK hydro energy capacity, 2017-21
      • Figure 21: UK hydroelectricity generation, 2015-20
      • Figure 22: UK hydroelectricity development pipeline, 2021
    • Pumped storage hydroelectricity
      • Figure 23: UK pumped storage hydroelectricity pipeline, 2021
  11. Bioenergy Electricity Generation

    • Recent government policy changes affecting the bioenergy sector
    • Clean Growth Strategy highlights bioenergy’s potential
    • Trade association calls on government to commit to 16% of electricity from bioenergy by 2032
    • Landfill gas
    • Sewage sludge digestion
    • Energy from waste
    • Advanced conversion technology
    • Animal biomass
    • Anaerobic digestion
    • Biomass and co-firing
    • Bioenergy installed capacity and generation
      • Figure 24: UK bioenergy installed capacity, 2017-21
      • Figure 25: UK bioenergy and waste generation energy capacity, as of end of March 2021
      • Figure 26: UK bioenergy generation, 2017-21
      • Figure 27: UK bioenergy development pipeline, 2021
  12. Market Forecast

    • Decarbonisation of the UK energy system
    • UK energy transition will push up electricity demand
    • A more flexible electricity system will be required to offset the intermittency impact of renewables and ensure security of supply
    • 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
    • Investors are starting to see opportunities in subsidy-free projects, storage projects and newer technologies
    • Offshore wind sector starting to explore green hydrogen
    • Renewable electricity capacity development pipeline
      • Figure 28: Renewable energy projects in pipeline, by technology, as of June 2021
      • Figure 29: Forecast renewable electricity generation, 2019-40
  13. Future Energy Mix and Demand

    • Future energy demand under National Grid’s Future Energy Scenarios
      • Figure 30: Annual electricity demand in Great Britain, 2020-50
      • Figure 31: Annual electricity demand in Great Britain, 2020-50
    • Achieving net zero requires detailed policies and clear accountabilities
    • Future potential energy mix
      • Figure 32: Projected installed electricity generation capacity (incl storage and interconnectors), by scenario, 2020, 2030 and 2050
    • Significant investment in whole-system infrastructure required
  14. Energy Policy and Legislative Environment

    • Government commits to reach net zero by 2050 and slash carbon emissions by 78% by 2035 compared to 1990 levels
    • Government sets out headline commitments to help progress towards Net Zero
    • UK makes good progress in decarbonising power sector, but more ambition is required to meet net zero
    • Support mechanisms and policies to decarbonise electricity
    • Renewables Obligation
    • Feed-in Tariffs
    • Carbon Price Floor
    • Contracts for Difference
    • Capacity Market
    • The Renewable Heat Incentive
  15. Companies and Brands – Key Takeaways

    • Investment in UK offshore wind manufacturing sector is being ramped up
    • UK offshore wind sector is starting to attract a broadening investor pool
    • Major UK solar developers seek acquisition and partnerships to accelerate growth
  16. Industry Structure

    • Overview
      • Figure 33: UK turnover of renewable energy industry, 2015-19
    • Solar PV sector sees rapid decrease in employment levels
      • Figure 34: Employment and number of companies active across UK solar PV supply chain, 2014-20
      • Figure 35: UK solar PV sector turnover, 2013-18
    • Offshore wind industry set for strong growth
    • Offshore wind ownership dominated by utility-style owners
      • Figure 36: UK offshore wind sector turnover, 2015-19
      • Figure 37: Employment across UK offshore wind supply chain, 2014-19
    • Onshore wind industry expected to be revived by renewed subsidy support
      • Figure 38: UK onshore wind sector turnover, 2015-19
      • Figure 39: Employment across UK onshore wind supply chain, 2014-18
  17. Company Profiles

    • Biogen (UK)
    • Biogen (UK) purchased by Ancala Bioenergy in 2017
    • Biogen acquires Tamar Energy, creating one of the largest independent AD operators in the UK
    • Financial performance
      • Figure 40: Financial analysis of Biogen (UK), 2015-20
    • First Hydro Company
      • Figure 41: Financial analysis of First Hydro Company, 2016-20
    • Lightsource BP Renewable Energy Investment
    • Lightsource BP is targeting 25GW solar developments globally by 2025
    • Lightsource Labs – the company’s in-house digital innovations arm
    • Financial performance
      • Figure 42: Financial analysis of Lightsource BP Renewable Energy Investment, 2016-19
    • ScottishPower Renewables
    • Financial performance
      • Figure 43: Financial analysis of ScottishPower Renewables, 2016-20
    • SSE
    • SSE sells retail unit to OVO Energy…
    • …and continues with the disposal of other non-core business areas
    • Renewables at core of SSE Group’s business strategy
    • Financial performance
      • Figure 44: Financial analysis of SSE, 2017-21
      • Figure 45: SSE revenue segmental analysis, 2020
    • Vattenfall Wind Power
    • Company outlook and strategy
    • Financial performance
      • Figure 46: Financial analysis of Vattenfall Wind Power, 2016-20
    • Vestas-Celtic Wind Technology
    • Company performance
      • Figure 47: Financial analysis of Vestas-Celtic Wind Technology, 2016-20
  18. Appendix – Data Sources, Abbreviations and Supporting Information

    • Abbreviations
    • Methodology
  19. Further Sources and Contacts

    • Trade associations
    • Trade magazines
    • Trade events

About the report

This market report provides in-depth analysis and insight supported by a range of data. At the same time, introductory and top-level content is provided to give you an overview of the issues covered.

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Mintel provides overviews of the top brands and manufacturers, and uses consumer research to explore attitudes and reactions to brands, as well as insight into what will resonate with consumers.

Data

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*databooks not available with UK B2B Industry reports.

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