As Robert Colvile comments here (£) for the Sunday Times, “when we talk about net zero, we are actually talking about electrification”. The net zero pathway involves a “massive” increase in electricity use - take the shift to electric cars and switch from gas boilers to heat pumps as examples - together with a “massive” increase in the amount of electricity generated by nuclear and renewables. And as Colvile adds, the path also involves a “massive” decentralisation of the National Grid - “to accommodate numerous tiny power sources and storage media (solar panels, car batteries etc) rather than a few big power stations”.
The commercial real estate sector has a significant role to play in this “rewiring” of the energy economy - take onsite energy generation via solar or electric vehicle charging provision at the roadside as examples. Yet as many are experiencing, and as Colvile notes, limiting factors are in play - grid connections, planning permission, or, taking a practical example as cited by the head of one electric vehicle charging network, waiting for “highways teams to approve the kerb design”. Significant pain points for those in the industry that are on this net zero pathway.
And so whilst Sunak’s recent announcement on net zero reform has garnered much attention - unquestionably, and in the author’s view wrongly, backtracking on critical areas of reform (e.g energy efficiency in domestic property), there are some snippets of positivity buried in the press release, particularly around grid connection. Take these announcements:
A “fast track” through the nationally significant infrastructure project planning regime, available for major eligible transmission projects, to ensure they are prioritised, helping businesses and households connect to the grid sooner.
A new approach to grid connections, where energy projects that are ready first will connect first – and ultimately get online quicker.
Can those in the real estate sector take some encouragement from this? As the press release states, “The Chancellor and Energy Security Secretary will bring forward comprehensive new reforms in due course”. Surely with an election looming and the “net zero” battleground now on the table, don’t hold your breath?
Whether it’s 2030 or 2035, if we don’t have enough electricity we’ll never get to net zero