National Grid issues the 2017 Future Energy Scenarios (FES)

National Grid’s ‘future insights’ team last week issued the latest version of the Future Energy Scenarios document .

The FES has made a remarkable journey in the short years since its first publication.  It has gone from a slightly obscure document to one that now is poured over from stakeholders across the industry.  The FES has been extremely successful in helping the industry to engage in wider discussions about the direction of travel for the energy industry.  Here at Xero Energy, we use the FES scenarios to help our clients forecast changes in project costs over the long term, including TNUoS, BSUoS, constraint risks and transmission losses.

This year’s publication definitely has some interesting changes compared to last year, including the changes to the names of some of the scenarios. ‘No Progress’ has been re-labelled as ‘Steady State’.

Right now, the industry is anything but steady state – lots of change going on.  From technical codes (EU codes come into force next year), to charging (Ofgem’s touted significant code review alongside recent decisions on embedded benefits and the usual flurry of CUSC/DCUSA mods) as well as fundamental discussions about how the energy system will work in the future (e.g. Ofgem / BEIS’s Smart, Flexible Energy System call for evidence and ENA’s Open Networks Project amongst others).

These changes sit alongside significant shifts in the make-up of the generation profile.  This year, it has been almost weekly that we have heard of firsts and new records for the energy system – first ‘working day’ without coal, lowest ever transmission system demand, first time below 100gCO2/kWh, highest quarterly energy volume delivered by renewables, etc.

All of this activity is combined with the rapidly improving economics relating to the deployment of renewables and battery energy storage, huge shifts in the retail market (sharp increases in the number of energy suppliers available), democratisation of electricity supply through blockchain transactions, continued digitisation of the networks, off-grid, micro-grid and local energy projects… to name but a few themes right now!

It is very difficult to see how any future energy scenario is likely to be steady state.