BoKlok’s sustainable homes can help solve the UK’s housing deficit
With a growing population and productions of homes being restricted due to planning regulations and land supply shortages, the UK has in...
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The UK leading the shift to a clean energy economy
Total energy consumption in the UK increased by 4.6 per cent between 2020 and 2021 from 128 to 134 million tonnes of oil equivalent but remained well below pre-pandemic levels (including non-energy use).
Renewable electricity generation was 28.2TWh in Quarter 3 2022, 18 per cent higher than 2021, although last year had been the lowest third quarter since 2017 due to unfavourable weather conditions and some onshore wind outages. Most of the increase was in wind generation driven by higher wind speeds and new offshore wind capacity. Solar PV generation was a record for Quarter 3 2022, driven by longer sunlight hours during the summer’s heatwave. Over the last year, 3.4 GW in new renewable capacity has been added, a 6.9 per cent increase. Most of the new capacity was in offshore wind (2.8 GW), continuing strong year-on-year growth that began in the first quarter of 2022 (with the third quarter showing a growth of 25 per cent on the same period last year). Renewables’ share of electricity generation was 36.3 per cent in Quarter 3 2022, up 1.1 per cent on last year. On a technology basis, wind generation was 17.3 per cent of total generation, and bioenergy was 11.9 per cent.
Swedish technology providers within renewables and cleantech solutions are renowned globally for their know-how and product development. With broad expertise, specifically in district heating, waste management, energy efficiency and storage, as well as sustainable construction, the UK market ought to provide Swedish companies with interesting opportunities.
Offshore wind is a success story for the UK. The UK is one of the world’s largest markets for offshore wind, with more than 10GW of cumulative installed capacity across 38 sites. There is a further 5GW in pre-construction, and there are plans for a further 11GW. The UK continues to drive investment and innovation in its thriving offshore wind sector through ambitious targets and the deployment of new technologies.
Sector growth was encouraged by the UK’s target of 40GW of offshore wind energy by 2030, as stated in the Ten Point Plan for a Green Industrial Revolution. This includes 1GW generated by floating technologies. This ambition was increased through the British Energy Security Strategy (BESS), published in April 2022, which aims to achieve up to 50GW of offshore wind by 2030. 5GW of this should utilise floating technology.
The Offshore Wind Sector Deal, announced in 2019, is driving the transformation of the UK offshore wind supply chain. There is an industry commitment to 60% local content by 2030 and it is expected that 90,000 jobs will be created in UK offshore wind by this time. The UK has designated the following as key strategic priorities for components manufacturing:
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Nacelle and hub
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Floating substructures
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Floating anchoring and mooring systems
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Blades
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Monopile foundations
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Towers
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Dynamic, export and inter-array cables
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Transition pieces
Heat networks form an important part of the government’s plan to reduce carbon and cut heating bills for customers. By driving forward new low carbon technologies like heat networks, we can cut the use of fossil fuels for heating our homes and shield households from oil and gas price rises that are being pushed up by pressures on global energy markets.
There is a significant opportunity for Swedish companies across the whole supply chain. Demand cannot be fulfilled by existing UK companies alone, and the market is already growing at 20% per year.
Through the Heat Network Transformation Programme (HNTP) the government is working with industry and local authorities, and investing over half a billion pounds in funds and programmes, to develop new heat networks and improve existing ones. In order to address the capacity and capability challenges which local authorities identified as barriers to heat network deployment in the UK, the government set up the Heat Networks Delivery Unit (HNDU) in 2013, providing support to local authorities in England and Wales through the early stages of heat network development:
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Techno-economic feasibility
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Detailed project development
To help shape a successful heat network market the government also works closely with senior industry leaders through the Heat Networks Industry Council.
Heat networks provide about 2% of the overall UK heat demand across the domestic, public, industrial and commercial sectors, but a much higher share can be achieved. Government's research suggests that 14-20% of the UK heat demand could be cost-effectively met by heat networks by 2030 and 43% by 2050.
Renewables’ share of electricity generation increased to a record 47.0% in 2020.
By 2030, the UK plans to quadruple its offshore wind capacity.
In Northern Ireland alone, the low carbon sector employs 12,000 people.
Scotland
With the growing shift away from fossil fuels, Scotland can help companies to transition from non-renewable energy sources to more sustainable solutions. There are opportunities for international investors, particularly in offshore wind, carbon capture, energy storage, hydrogen, and decarbonisation of heat and transport.
Scotland is the windbreak of Europe, with 3.5GW of offshore wind already operational or under construction as of November 2022 and a strong offshore wind market ready for investment.
Scotland is home to the world’s first tidal array, the world’s first floating offshore wind farm, and one of Europe’s largest hydrogen bus fleets.
Wales
Wales is already making good progress on previous targets set in 2017 and, already, generates 55% of our electricity from renewables. On 24 January 2023, the Minister proposed Wales sets a target for at least 1.5 GigaWatt of renewable energy capacity to be locally owned by 2035, excluding heat pumps.
In October 2022, the Welsh Government announced they were planning to establish a Renewable Energy Developer for Wales, wholly owned by the Welsh Government, to develop large scale solar and wind projects on public land.
The Welsh Government’s strategy to decarbonise the energy sector and accelerate renewable energy development is set out in its Net Zero Wales Plan. The Plan outlines actions the Welsh Government (and others) need to take, over the next five years, to reduce reliance on fossil fuels and drastically reduce greenhouse gas emissions from the energy sector. It also takes a longer-term view, looking towards the net zero by 2050 target.
The Welsh Government has a target for Wales to meet 70% of its electricity demand from Welsh renewable electricity sources by 2030.
Northern Ireland
Of all renewable electricity generated within Northern Ireland over the 12 month period January 2022 to December 2022, 85.3% was generated from wind. This compares to 82.1% for the previous 12 month period (January 2021 to December 2021).
With excellent advanced manufacturing and engineering capabilities, world leading academia and strong innovation, research and development ethos, Northern Ireland is well positioned to take advantage of the emerging green opportunities. Businesses in Northern Ireland have the potential to be an important player in the development of low carbon enabling technologies to assist key industry sectors such as heat, energy and transport.
Swedish technology providers within renewables and cleantech solutions are renowned globally for their development, implementation and exports. With broad expertise, specifically in district heating, waste management, energy efficiency and storage, as well as sustainable construction, the UK market ought to provide Swedish companies with interesting opportunities.
Clusters
Business cases
Meet the Swedish businesses that are making it in the UK renewable energy sector.
Smart City technology
The UK Smart City Tech sector represents a growing market, where smart cities continue to expand in both number and level of sophistication. Currently, almost a third of the UK’s urban areas with populations of over 100,000 have clear ambitions and/or substantial programmes of current activities labelled as ‘smart’.
While the past decade was characterised by pilot projects and a select group of innovator cities, the coming decade will likely see widespread uptake of smart city solutions. Hence, UK smart cities are set to provide growing commercial opportunities for Swedish companies offering solutions that address the challenges of urbanisation and its effect on the environment.
The UK’s diverse profile of smart cities provides opportunities for companies to match their capabilities with the particular needs of each city. For example, cities with advanced infrastructure (London, Glasgow, Bristol) can offer testbeds for commercialising novel technologies and solutions. Developing smart cities (Newcastle, Leeds, Nottingham) may still have infrastructure needs or require upgrades. Emerging smart cities (Aberdeen, Belfast, Cardiff) can act as a blank canvas for more holistic smart city solutions. In addition, different cities are developing research expertise and particular interest in different smart city areas, including: smart energy (Bristol, London); smart buildings (Glasgow, Nottingham); smart infrastructure (Newcastle, Brighton); smart mobility (Cambridge, Leeds). This presents an array of opportunities across the UK for Swedish solution providers operating within different areas of the smart city space.
Northern Ireland is recognised as a global leader in smart cities primarily because of its creativity and technological expertise. Its companies have a diverse range of smart city capabilities, providing solutions from data analytics, smart governance, smart mobility and infrastructure to smart buildings, energy and health.
Northern Irish companies are successfully exporting innovative smart solutions for intelligent tracking solutions for assets; data insights to help transform cities for planning; providing pedestrian & crowd analytics insights; remote building and machine monitoring; enabling the use of technology and data to improve and connect networks, services and the urban environment for the benefit of citizens and the economy.
In addition to business opportunities, the UK provides support and funding for smart city innovations. Programmes like the Connected Places Catapult (the UK’s innovation accelerator for cities) help businesses develop, implement and commercialise the latest technology and innovation for existing markets, as well as create demand and grow new markets in the UK. Innovate UK (the country’s innovation agency) provides funding for business and research collaborations that accelerate innovation and drive business investment into R&D. Support is available across all sectors, value chains and UK regions. Innovate UK’s recent funding for smart cities has included: the cyber security challenges in the Internet of Things; innovative 5G infrastructure technologies; low carbon technologies; connected and autonomous vehicles; and sustainable urbanisation.
The UK also provides support for companies through R&D tax credits and is home to numerous centres of excellence and university collaborations that are focused on smart city developments.
Sweden has a long history of developing innovative solutions across a diverse array of cleantech and smart city tech areas. These include solutions within energy, waste management, mobility and many other areas related to the sustainable development of cities. As a world leader in digital competitiveness and innovation, Sweden also develops the digital technologies that hold together the grid for smart city solutions – particularly within areas such as renewable energy, smart grids, water, waste-to-energy and smart mobility, which can help shape a more sustainable future for cities in the UK.
Substantial public and private capital is needed for decarbonisation projects, together with major investment in research and development. Investment is also needed in technology that integrates locally-generated energy into the electricity system, as well as in digital technology and innovation. COP 26 and the Prime Minister’s Ten Point Plan also give the British Embassy an opportunity to discuss with Swedish industry the future of issues such as heat, hydrogen, wind and other renewable energy and smart city solutions and technology – areas where Sweden excels.
Business case
Clusters
Wind
North Scotland, Forth & Tay (Scotland), North East, North West, Humber, East Anglia, Solent, North Wales.
Heat
Bristol, Liverpool, Leeds, London, Scotland.
Wave and tidal
Scotland: Lewis, Shetland (Scotland), Northern Ireland: Strangford, England: Cornwall, Falmouth, Wales: Pembrokeshire, Anglesey
Smart City solutions
Edinburgh, Glasgow, Manchester, Birmingham, Leeds, Nottingham, Liverpool, London, Oxford, Cambridge
Networks
Grants, tax reliefs and other incentives for businesses
Innovate UK/Innovation competitions
Funding for innovative smart energy systems/competitions
Heat Networks Investment Project
Local Authority Support by the Heat Networks Delivery Unit
Scottish Government/Scotland’s Heat Transition Deal
There are a range of financial incentives open to companies looking to develop solutions for the energy transition in Scotland, including: Green Jobs Funding Call, Energy Transition Fund, H2020 Funds, Scottish National Investment Bank, Green Investment Bank, Germany’s Hydrogen Strategy – Int. Partnerships, BEIS Fund UK Gov
Invest Northern Ireland may be able to offer companies: Revenue grants towards start-up costs, interest relief, factory rental costs, training costs, marketing development costs and R&D. R&D capital spending can be written off against income. Also pre-employment training grants, employment grants, finance investment in the share capital of a company and government loans at commercial and concessionary rates, property tax exemptions for manufacturing property, depreciation allowances. Northern Ireland also has an active venture capital market catering for projects up to £2m.
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