The electricity grid is the backbone of our modern energy system, supplying power to homes, businesses, and industries. However, the traditional centralised grid model is facing challenges in meeting the increasing demand for electricity while transitioning to a more sustainable and resilient energy future. In the UK, a shift towards onsite energy generation is gaining momentum as a viable solution. In this article, we will explore the electricity grid in the UK, its limitations, and the benefits of onsite energy generation.
The warehouse and logistics sector in the UK has experienced remarkable growth over the past decade, with the number of business premises dedicated to transport, logistics, and warehousing nearly doubling. This rapid expansion, especially when compared to other sectors, highlights the sector’s significance in driving economic progress. Interestingly, the surge in growth can be attributed, in part, to the pandemic and the subsequent shift in consumer purchasing behaviour. However, despite this impressive growth, there is a looming threat to the sector’s continued success—the strain on the electricity grid.
In 2021, electricity generation hit a record low, declining by 1.2% compared to the previous year. This drop is particularly concerning given that electricity demand remained high due to economic recovery and the growing trend towards decarbonisation, which encourages the electrification of heating and transportation through technologies like heat pumps and electric vehicles. For businesses in the logistics and warehousing sector, up to 71% of electricity demand is solely attributed to electric lighting in an average 15,000m2 ambient warehouse.
To bridge the gap between supply and demand, the UK heavily relied on net imports in 2021. However, this reliance on imports became a significant talking point the following year following the energy crisis in Ukraine. As a result, governments have sought to enhance their energy security measures.
While progress is being made in addressing both energy security and achieving net-zero targets through increased domestic renewable generation, a crucial problem remains—the lack of grid capacity to fully harness these advantages. Renewable energy generators across the UK have shared stories of impossibly long wait times, up to a decade, to connect to the grid. This bottleneck is hindering the sector’s growth. According to National Grid, approximately 600 projects with a combined capacity of 176GW are waiting in the queue in England and Wales, while only 64GW of connected capacity exists.
Unlike households, businesses cannot simply reduce their energy usage by turning down thermostats, as electricity is an essential aspect of their operations. While achieving a balance between efficiency measures and onsite generation can provide businesses with an advantage in managing their energy bills, it is essential to address the root problems. With the transport and storage sector poised for further growth, it is crucial to improve grid capacity to meet these ambitions. By investing in grid infrastructure enhancements, policymakers and energy providers can ensure the continued success of the warehouse and logistics sector while contributing to a sustainable and resilient energy future in the UK.
We have gathered the most common questions that these businesses have asked us to compile an infographic that power generation businesses can use to better understand the subject. Skip to Infographic
The UK Electricity Grid
The electricity grid in the UK is a complex network of transmission and distribution lines, substations, and power stations. It connects power generation sources, such as coal, gas, nuclear, and renewable energy installations, to consumers nationwide. National Grid, the system operator, manages and maintains the grid, ensuring a reliable and stable supply of electricity.
Limitations of the Centralised Grid Model
The centralised grid is susceptible to disruptions and outages due to equipment failures, extreme weather events, or cyber-attacks. These can lead to power outages, impacting businesses, households, and critical services.
The transmission of electricity over long distances results in energy losses. These losses contribute to inefficiencies in the energy system and increased costs for consumers.
The reliance on fossil fuel power stations in the centralised grid model contributes to carbon emissions and climate change. Transitioning to cleaner energy sources is essential for a sustainable future.
Benefits of Onsite Energy Generation
Onsite energy generation, also known as distributed generation, involves producing electricity at or near the point of consumption. Here are some key benefits of onsite energy generation in the UK
Generating electricity onsite allows businesses and homeowners to reduce their reliance on the centralised grid. By generating their power, they can ensure a more reliable energy supply and have greater control over their energy costs.
Onsite energy generation enables the integration of renewable energy sources, such as solar panels and wind turbines. This helps reduce carbon emissions and supports the UK’s commitment to achieving net-zero greenhouse gas emissions.
Onsite energy generation can lead to significant cost savings over the long term. Businesses and households can generate electricity at a lower cost than purchasing it from the grid, especially with the declining costs of renewable energy technologies.
Onsite generation allows for efficient energy utilisation. Combined Heat and Power (CHP) systems, for example, can simultaneously generate electricity and capture waste heat for heating or cooling, maximizing energy efficiency.
Onsite energy generation can support the centralised grid by reducing strain on transmission infrastructure, providing backup power during outages, and participating in demand response programs to balance supply and demand.
Onsite generation from renewable sources contributes to reducing carbon emissions, air pollution, and environmental degradation. It helps create a more sustainable and cleaner energy system.
Understanding the limitations of the centralised electricity grid in the UK and the benefits of onsite energy generation is crucial for businesses, homeowners, and policymakers alike. Embracing onsite generation, integrating renewable energy sources, and leveraging technologies for energy efficiency can lead to a more resilient, sustainable, and cost-effective energy system. By diversifying our energy sources and empowering local energy production, we can pave the way for a greener and more independent energy future in the UK.
At Biosus Energy, we understand that businesses in the UK often have questions about the National Grid and how it impacts their onsite power generation needs. To address these common queries, we have created an informative infographic that sheds light on this topic.
The infographic covers several key areas, including:
- National Grid Electricity Transmission Control Centre: This section explains the role of the National Grid Electricity Transmission control centre in balancing the supply and demand of electricity. It highlights the importance of maintaining stability and reliability in the grid system.
- Distribution Network Operators (DNOs) and Independent Distribution Network Operators (IDNOs): Here, we delve into the roles and responsibilities of DNOs and IDNOs. We explore how these entities manage the distribution of electricity in different regions, ensuring that power reaches businesses and homes efficiently.
- Types of Grid Connection Offers: Businesses often inquire about the various grid connection offers available to them. In this section, we outline different options, such as standard offers and contestable offers, and provide insights into the processes involved in obtaining a grid connection.
- The Need for Grid Connection: Some businesses question why they require a grid connection if they don’t plan to export any power. We address this concern by explaining the benefits of being connected to the grid, such as access to backup power and the ability to purchase electricity during periods of high demand.
By exploring these topics, our infographic aims to provide businesses with a clearer understanding of the National Grid and its relevance to their onsite power generation requirements. We believe that informed decision-making regarding grid connections can lead to more efficient and cost-effective energy solutions for businesses across the UK.
The benefits of solar PV systems extend beyond mere cost savings. By adopting solar energy, commercial consumers demonstrate their commitment to a greener future and contribute to the UK’s sustainability goals. As solar technology continues to advance and become more accessible, there has never been a better time for businesses to invest in solar PV systems and reap the financial rewards while making a positive environmental impact.
Remember, by harnessing the power of the sun, commercial consumers can not only reduce their energy costs but also take an active role in shaping a more sustainable and prosperous future for generations to come.
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