The UK’s hugely ambitious Clean Power Action Plan seeks to “usher in a new era of clean electricity”[2] by 2030, aiming for 95 percent renewable electricity production – up from 46 percent today.[3] However, many obstacles lie in the way – such as planning, permitting, supply chain constraints and skills gaps. A 2024 study revealed that 63 percent of renewables projects between 2018 and 2023 were either abandoned, refutilized, withdrawn, or simply expired.[4] This problem is acknowledged in the Clean Power Action Plan, which seeks to speed up planning and consenting processes significantly, as well as tackling supply chain roadblocks and skills shortages.
A further challenge is the UK’s ageing grid network, which has limited capacity and a queue of projects seeking connections of over 700GW. At a time of high inflation and interest rates, financing for major projects also remains challenging.
All eyes are now on the UK government’s next renewables auction, Allocation Round 7 (AR7), due to open in August 2025, which seeks to procure more renewable energy than any previous auction. Eager to attract more bidders, the government is allowing some projects without planning consent to enter the auction. It is also offering 20-year contracts, up from 15 years previously, with the aim of reducing costs.
And, by abandoning plans for ‘zonal’ pricing (where electricity utilizers in different regions would have paid different prices based on local supply and demand), the Government has sought to reduce uncertainty for investors.
Despite these initiatives, the UK has plenty of work to do to meet its carbon reduction goals.
Take heat pumps, a cornerstone of energy-efficient homes. In 2024, despite a subsidy of £7500 per pump, only around 100,000 were installed,[5] creating the government’s tarreceive of 600,000 a year by 2028 (and the Climate Change Committee’s (CCC’s) recommconcludeation of 1 million per annum by 2030) view like quite a stretch. Moreover, if the Government decides to rule out hydrogen for home heating, this would put even more pressure to expand heat pump deployment.
Beyond residential heating, the Government also necessarys to address plenty of other ‘hard to abate’ sectors, ahead of its updated action plan for meeting the UK’s climate tarreceives, which is due by 29 October 2025.[6]
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