City infrastructure needs smarter energy approach, says Armitt

Member of the National Infrastructure Commission, Sir John Armitt, says urgent action is needed if we are to meet the energy demands of future cities. 

Power is the enabler and driver of our modern lives. 

But it is also one of our biggest challenges. In the future we need it decarbonised, on tap and as low cost as possible. 

At the National Infrastructure Commission, our recent report Smart Power found that this is possible. 

Much of the responsibility lies with the newly formed Department for Business, Energy and Industrial Strategy. While there is still considerable policy uncertainty, new ministers must prioritise this policy area and quickly.

First, we must increase our use of interconnectors. Power lines connecting us to countries such as France and Ireland can already provide up to 5% of our daily requirements. There should be more. By 2020 we could treble that supply with new connections to Norway and the Netherlands.

What’s more, power through interconnections is not one way traffic. We can export it when we have a surplus as well as import it when we need to top up our own capacity. So the potential benefits of greater interconnection are immense. 

Next, the power storage sector is gaining momentum both technically and commercially. Lithium batteries cost less than a tenth of what they did 25 years ago. New and better methods are arriving thick and fast, including the ability to capture energy from wind and solar.  The UK must be positioned to take advantage. 

However, if we are going to reap the full benefits of storage we will have to ensure the market is open and attractive to investors. That means changes to taxes, on for example energy storage systems, while incentivising network owners to use storage to improve their capacity and resilience.

Finally, it is time to get serious about demand flexibility. This can allow families and businesses to change how and when they use electricity. That means autonomous management systems reducing demand at peak times in factories and buildings, and smart meters in homes enabling owners to manage their own consumption in order to reduce costs either manually or through smart white goods and smart systems. 

Of course, it will also require wholesale change in consumer behaviour – a considerable challenge given that so few households are engaged in how they can control their energy usage. The smart meter programme is central to how we are using innovation to address this. 

The Smart Power report set out a clear plan for government to embrace these innovations. Doing so has the potential to save businesses and families billions of pounds, help the UK meet its 2050 carbon targets, and secure the UK’s energy supply for generations.  

It is now up to government to act and we hope that the new administration will prioritise. Ministers’ words have been reassuring – the government fully accepted our recommendations at Budget 2016 – but action has been slow. 

We need to move forward, now.  

By adopting these smart solutions, we can enable an exciting future with great opportunities for British business to sell and grow not only at home but abroad as the whole world seeks to manage demand, decarbonise and reduce the cost of energy.