Wales’s energy future (25/11/2016)

Published 25/11/2016   |   Last Updated 27/05/2021   |   Reading Time minutes

The developed world is moving away from ‘dirty’ energy sources towards a more diverse energy mix. With new legislative powers and international agreements on climate change setting the scene, how will Wales respond to the challenge?

Limiting future climate change by radically reducing the amount of carbon released into the atmosphere is one of the greatest global challenges.

The energy supply sector is one of the biggest greenhouse gas emitters in Wales. If we are to meet international and domestic obligations on reducing emissions (see article on climate change), one way to move in the right direction is to relook at how energy is generated, supplied and transmitted. This is a key part of addressing the energy ‘trilemma’ of affordability, security and decarbonisation.

The Welsh context

The Environment (Wales) Act 2016 commits Wales to reducing its greenhouse gas emissions by 80% by 2050. The latest greenhouse gas inventory for Wales showed that energy supply constituted 42% of total 2013 greenhouse gas emissions. The main sources of emissions were power stations (76%) and oil refineries (16%). If Wales is to transition to a cleaner, greener, sustainable energy future, there is consensus that renewable energy must play a greater part in the energy mix.

The forthcoming Wales Bill is likely to give the Welsh Government further consenting powers over energy projects. At a time when there are many large energy projects on the horizon, some of which are the subject of much debate, the Fifth Assembly could mark a turning point in the approach to energy developments in Wales.

A question of balance

The current energy model in Wales comprises renewable and non-renewable sources. Reliance on fossil fuels is unsustainable in the long term, and developing renewables for energy generation is necessary to meet EU and UK Government targets on greenhouse gas emissions and to ensure fuel security. Wales is rich in natural resources, with geography and topography that lends itself to a wide range of renewable energy technologies. There are however differing views about the extent to which larger inward investment energy projects will be needed in future, or if diffused local projects, together with energy efficiency measures, will enable Wales to meet most of its energy needs.

The new Welsh Government will need to clarify how it will balance support for large-scale projects such as new nuclear developments, tidal lagoons, wind farms, grid enhancements and interconnectors, against more funding and support for local and community-led schemes such as micro hydro, biomass, solar and wind projects.

The legislative framework

Achieving the right future energy mix in Wales will be key to meeting the climate change commitments set out in the Environment (Wales) Act 2016 and to fulfilling the sustainable development ambitions of the Well-being of Future Generations (Wales) Act 2015. The Planning (Wales) Act 2015 makes an important change by introducing a new category of planning permission for Developments of National Significance (DNS). The Welsh Government will in future directly decide on DNS applications for energy generation projects of between 10MW and 50MW. For onshore wind farms there is no upper MW limit due to recent legislative changes made in England.

The forthcoming Wales Bill is expected to give the Welsh Government powers to make decisions on all other large onshore and offshore energy projects up to 350MW, currently decided by the UK Government.

Previous Welsh Government action

The last Welsh Government set out its vision for energy in Energy Wales: A low carbon transition in 2012. In 2015 it issued Green Growth Wales: Local Energy outlining its approach to local energy. More recently, Carl Sargeant, the then Minister for Natural Resources, launched the Local energy service. The service aims to provide SMEs and social enterprises with technical and financial support to develop renewable energy projects.

Delivering energy transformation

The Fourth Assembly’s Environment and Sustainability Committee conducted two large-scale inquiries into energy. The first, Energy Policy and Planning in Wales, considered how devolution arrangements for energy policy and planning affect the Welsh Government’s desired future ‘energy mix’. The Committee concluded that the energy sector is vitally important to Wales, and there is huge potential for developing renewables here. The second, A Smarter Energy Future for Wales? built on this work.

Its recommendations for the new Welsh Government included that:

  • the Welsh Government must demonstrate leadership, and policy should direct Wales towards meeting its domestic energy needs from renewable sources;
  • conserving energy, reducing demand and building regulations should be fundamental to change;
  • Wales should exploit opportunities to design innovative smarter places that integrate transport, energy and communications infrastructure, improve well-being and reduce carbon emissions;
  • retrofitting energy efficiency measures into existing housing stock has a crucial part to play, and Welsh Government schemes such as Nest and Arbed will be key to improvements;
  • a not-for-profit Energy Supply Company (ESCO) for Wales should be established; and
  • planning policy and decision-making should be aligned with any vision for future energy policy. National and local planning policy need to encourage reductions in carbon emissions.

The Committee’s view was that everyone in Wales shares responsibility for the transition to a smarter energy future. It highlighted that the legislative framework to make progress on reducing carbon emissions, encouraging local energy supply and increasing renewables supply is already in place.

The Committee argued that within this conducive policy and legislative framework, and with impetus at all levels of government and across all sectors, Wales must ‘seize opportunities to transform its approach to energy now’.

Key sources

Article by Chloe Corbyn, National Assembly for Wales Research Service