This Key Note Market Report examines the renewable energy industry within the UK. Over the past year, consumption of renewable energy sources has increased by 9.8% from 6.9 million tonnes of oil equivalent (mtoe) to 7.6mtoe, while, over the 5-year period, consumption increased by a massive 60.3%.
Renewable energy is principally used for electricity and heat generation. Electricity generation accounted for 63.9% of all renewable energy produced in 2010, while heat generation represented just 15.8%. Biomass remained the most popular source of renewable energy throughout the review period, with 5.1mtoe consumed in 2010. Using renewable energy for transport fuel has increased dramatically over the past 5 years, with a massive surge in usage in 2008, when figures increased from 361,700 tonnes of oil equivalent to 844,500 tonnes of oil equivalent. Overall, the usage of renewable energy sources for transport fuel grew by 546.6% between 2006 and 2010.
The main factors which have had a significant impact on the renewable energy sector over the past few years have been legislative and the way in which renewable energy fits in with the UK’s low-carbon energy targets over the next four decades is an ongoing topic of debate. There is also much conjecture around whether the Government should incentivise and subsidise the market. As renewable energy projects are extremely capital intensive and, therefore, costly, they need investment and government support in order to make them commercially viable.
The market is forecast to grow dramatically over the next 4 years, as it is predicted that renewable energy will feature highly in the future fuel mix in order to secure more economically and environmentally viable energy supplies and a low-carbon future. By 2020 it is expected that the level of renewable energy used in the UK’s fuel mix will have grown, relative to 2011, by 236%.
This report is available to current London Business School staff, students and faculty from Key Note Online which can be found on the A-Z list of library databases via Portal.