Manufacturing highlights from the Energy Security Strategy

The Strategy, released amidst a worsening energy price crisis and concerns around the international reliance on Russia for fossil fuel exports, aims to boost the UK’s long-term energy independence.

The overarching goal is to accelerate the deployment of wind, nuclear, solar and hydrogen energy capacity in the UK, as well as supporting the production of domestic oil and gas in the near-term.

Supply chains in the nuclear and renewable energy industries are set to benefit significantly. New objectives include achieving 50GW of offshore wind capacity by 2030 (up from 40GW under previous plans) and enough nuclear power to deliver 25 per cent of the UK’s needs by 2050.

In addition, the government intends to increase the production of British-made heat pump technology, and boost solar power by simplifying the planning rules for installing solar on domestic and commercial rooftops.

The recent Spring Statement also reduced the cost of solar panels for businesses by introducing business rates exemptions for eligible renewable energy plant and machinery.

However, measures to improve energy efficiency were lacking, despite this being the cheapest and greenest way to reduce energy bills and boost energy independence. Experts believe this is an area businesses, and manufacturers in particular, should be focusing on.

The Energy Intensive Industries Compensation Scheme, which provides participants with an exemption from paying renewable energy levies in their energy bills, is set to be to at least 2025. However, the scheme is only open to certain industries and those whose electricity costs amount to 20 per cent or more of their earnings.

Speaking to one news outlet about the impact of energy prices on manufacturers, Paul Walsh, Managing Director of building analytics firm CIM, said the crisis was a “super pain-point” across multiple sectors, not just those traditionally regarded as energy intensive:

“Manufacturers need to aggressively target energy costs, particularly in non-validated areas that are often left undiagnosed, such as HVAC equipment that is not operating as it was originally intended or designed to. Identifying and resolving multiple small gains can have an enormous impact on energy costs.

“Ultimately, as sharp as this spike will feel now, an improvement in energy efficiency over the next 4–5 years is the only sure-fire way manufacturers can future-proof themselves against any further energy crises.”

For expert one-to-one support and guidance on reducing your energy bills and associated carbon emissions, contact our Resource Efficiency Service.