Decarbonising the power sector

In developing its delivery plan for power decarbonisation, DESNZ should: a) establish how it will ensure the system is resilient to prolonged periods of low generation from renewables. This should include considering the potential costs and benefits of maintaining some carbon-emitting power generation (such as unabated gas), while still achieving net zero across the economy;

b) within 12 months, review plans for achieving its ambitions for offshore wind and nuclear power expansion. Where DESNZ determines that these ambitions are unattainable it should develop alternative options that enable it to achieve its broader power sector ambitions, such as investing in demand-side flexibility; and

c) ensure it has understood the main links between different aspects of decarbonisation and sets out in advance how these will be managed. This should include how to determine the best sequencing of changes and investment, such as ensuring how network capacity keeps pace with expanding generation.

In developing arrangements to oversee progress against its plan, DESNZ should: d) review the capability of its modelling to refine and update the most cost-effective system-wide approach to achieving net zero, including power sector decarbonisation. It should consider, for example, the location of new generation, the impact of revisions to market arrangements and the potential role for greater demand-side flexibility. Where it identifies gaps in its modelling DESNZ should consider alternative sources of information to enable it to identify and respond to significant changes which might affect the most cost-effective pathway towards decarbonisation;

e) establish a set of clear measures of overall progress, and some interim milestones towards power sector decarbonisation. It should report progress against these measures and milestones annually to Parliament, along with an explanation as to how this performance information has been used to determine any significant changes to its overall plan; and

f) establish arrangements to understand and respond to system-wide risks and opportunities, to ensure its plan is resilient to setbacks, disruption and future uncertainty. This will involve having an overview of the cumulative demands on, for example, workforce, materials and investment across the system.