Renewable Energy 2024 – England and Wales | Page 3

Chapter 6 41

12 Overview of the Renewable Energy Sector

1.1 What is the basis of renewable energy policy and regulation in your jurisdiction and is there a statutory definition of ‘ renewable energy ’, ‘ clean energy ’ or equivalent terminology ?

The Promotion of the Use of Energy from Renewables Sources Regulations 2011 ( SI 2011 / 243 ) applies the definition set out in Directive 2009 / 28 / EC ( Renewable Energy Directive ) on the promotion of the use of energy from renewable sources . This defines ‘ energ y from renewable sources ’ as ‘ energ y from renewable non-fossil sources , namely wind , solar , aerothermal , geothermal , hydrothermal and ocean energ y , hydropower , biomass , landfill gas , sewage treatment plant gas and biogases ’, each of which is then defined separately .

This legislative framework required the government to ensure that renewable energy comprised 15 % of the UK ’ s total energy mix by 2020 . The Renewable Energy Directive has now been superseded by Directive ( EU ) 2018 / 2001 ( RED II ). Although the UK has now been released from the renewable energy targets under RED II following Brexit , the UK-EU Trade and Cooperation Agreement includes a commitment to promote energy efficiency and the use of energy from renewable sources and reaffirmation of the EU ’ s 2030 ‘ targets ’ and the UK ’ s 2030 ‘ ambitions ’ for renewable energy and energy efficiency .

Ongoing policy and regulation of renewable energy is currently derived from retained EU law and English statute , notably binding commitments to :

■ cut greenhouse gas emissions by 78 % by 2035 compared to 1990 levels in the Carbon Budget Order 2021 ( SI 2021 / 750 ); and

■ achieve an 100 % reduction of greenhouse gas emissions by 2050 compared to 1990 levels ( the ‘ net zero ’ target ) in the Climate Change Act 2008 ( 2050 Target Amendment ) Order ( SI 2019 / 1056 ).

There are various other policies , incentives , requirements and regulations that are detailed throughout this chapter below .

1.2 Describe the main participants in the renewable energy sector and the roles which they each perform .

Governmental participants The Department for Energy Security and Net Zero ( DESNZ ) is responsible for overseeing the electricity sector , including in relation to renewable energy . DESNZ was formed on 7 February 2023 inheriting the energy policy responsibilities of the former Department for Business , Energy and Industrial Strategy ( BEIS ).

DESNZ is supported by other public bodies , including :

■ The Gas and Electricity Markets Authority ( GEMA ): GEMA has primary responsibility for regulation of the energy sector . Its powers and duties are derived from statute ( including the Gas Act 1986 , the Electricity Act 1989 ( Electricity Act ), the Utilities Act 2000 , the Competition Act 1998 , the Enterprise Act 2002 and the Energy Acts of 2004 , 2008 , 2010 and 2011 ), together with directly effective European Community legislation that was retained by the UK after its exit from the EU .

■ The Office of Gas and Electricity Markets ( Ofgem ): GEMA delegates regulation of the renewable energy sector to Ofgem , a non-ministerial government department . Ofgem administers environmental programmes and sustainability schemes on behalf of the government ( see question 3.10 for more detail ). Key duties and functions concerning electricity include :

■ regulating distribution and transmission networks ;

■ granting licences ;

■ protecting the interests of existing and future electricity ( and gas ) consumers ;

■ ensuring that electricity wholesale and retail markets are competitive ; and

■ managing the commercial tender process for offshore transmission projects .

The Energy Security Bill , introduced to Parliament on 6 July 2022 , includes measures that would ( if enacted as law ) establish a new independent body , the Future System Operator ( known in the Bill as the Independent System Operator or ISO ), which will be tasked with strategic oversight across the UK ’ s electricity and gas systems .

Private participants

■ Generation companies : following privatisation of the generation industry in the 1990s , an increasing number of generating companies have been established , including the ‘ big six ’: British Gas ; e . on ; EDF ; RWE ; Scottish Power ; and SSE . However , Ofgem has announced that it will no longer use the term ‘ big six ’ ( who once controlled 98 % of the domestic supply market ), now that their market share has shrunk to under 75 %, after acquisitions , mergers and a customer exodus to smaller challengers .

■ Transmission companies : the transmission network is owned and maintained by regional transmission companies : National Grid Electricity Transmission plc for England and Wales ; Scottish Power Transmission Limited for southern Scotland ; Scottish Hydro Electric Transmission plc for northern Scotland and the Scottish islands groups ; and Northern Ireland Electricity for Northern Ireland . The

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