Gas crisis: Boris Johnson to pledge all UK electricity will come from renewable sources by 2035


Boris Johnson is expected to pledge that all UK electricity will come from renewable sources by 2035.

The prime minister will propose this as a solution to the country’s reliance on gas and fossil fuels, as he is to address the Tory conference later this week, The Times reported.

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The plan is seen as a significant step towards reaching net-zero carbon emissions in 2050 and away from the fluctuations in gas prices.

As of Monday afternoon, the UK’s demand was around 33.8GW, according to data from National Grid PLC (LSE:NG.). Over a third (33%) was met by gas, 25% by wind, 13% by nuclear, 11% by solar, 7% by biomass and 1% by hydroelectric.

The UK has made great strides in reducing its dependency on coal power generation, which represented only 1.8% of the electricity mix in 2020, down from 40% in 2012.

“Coal exits can be assisted by a variety of techniques such as a transition to renewables (primarily wind and solar) and conversion of coal plants to gas or biomass plants. In Britain, for example, the government aims to complement its coal exit with a target to increase offshore wind capacity by 40GW by 2030. The exit, or phase-out, of coal will vary regionally and by sector,” analysts at Morgan Stanley (NYSE:MS) commented.

However, leaving gas behind remains a significant challenge. Experts say that it isn’t clear how the UK can reach the new target with the current rules in place.

The government is expected to support the transition to an all-renewable mix with nuclear energy, which would help to cope in times of variable supply.

Johnson told The Times that Britain would “deal with the cost of electricity and energy” by increasing “our clean energy generation”.

“Dealing with the cost of electricity and energy [is one of] the long-term things that government has got to do. We’ve got to get back into nuclear, we’ve got to increase our clean energy generation. That will bring the cost of energy down and bring down the cost of transport,” he said.

Looking at the markets, the move is likely to benefit specialist investors in the sector such as NextEnergy Solar Fund Ltd (LSE:NESF), Greencoat UK Wind PLC (LSE:UKW, FRA:3GC), HydrogenOne Capital Growth PLC (LSE:HGEN), alongside more generalist renewable funds like Downing Renewables & Infrastructure Trust (LSE:DORE) and Octopus Renewables Infrastructure Trust PLC, along with battery storage-focused groups like Gore Street Energy Storage Fund PLC and Gresham House Energy Storage Fund.


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