A temporary utilities equipment supplier is highlighting the importance of manufacturers transitioning to flexible and green energy distribution models following the announcement that the UK will bolster its power capacity by 14% more than previous recommendations.
According to a letter from Business Secretary Kwasi Kwarteng, the Government’s power capacity auction target will be set 14% higher than the National Grid’s proposals. A key factor behind this move is the rising price of gas, on which the UK’s power infrastructure is highly reliant.
According to Aggreko, this combination of soaring energy costs and reliance upon the national grid could leave manufacturers in a worsening situation if innovative strategies are not put in place. Specifically, the temporary solutions provider is highlighting the importance of transitioning to alternative, greener fuel sources implemented within energy-as-a-service models in order to pre-empt potential upcoming power provision crises.
“Skyrocketing energy costs continue to dominate headlines, but as this recent Government target shows, we are in this crisis for the long haul,” says Chris Rason, Managing Director at Aggreko Northern Europe. “As such, it is vital that business owners address what will become a huge issue before the situation worsens later this year.
“Our national grid, in its current condition, is facing significant challenges when it comes to supplying the manufacturing sector. Consequently, we would recommend putting in place short-to-medium term steps toward more flexible energy provision to address what will be a long-running concern. This includes opting for on-site generator equipment, including battery and hybrid systems powered by fuels such as hydrotreated vegetable oil (HVO).”
The effectiveness of ongoing decarbonisation efforts can be seen in Aggreko’s own fuel take-up figures, in which HVO rapidly grew from constituting a negligible part of its supplied fuel volume in 2020, to 18% of the total by Q3 2021. It follows Aggreko’s increased investment in the technology, which can be used as a ‘drop-in’ replacement fuel to power critical equipment.
In 2021, Aggreko surveyed 200 decisionmakers from large UK manufacturing plants and found that 79% faced pressure to reduce business energy costs since 2020. Additionally, 80% said they are now more likely to outsource distributed energy contracts.
Chris added: “Our own findings have shown that not only is the rising cost of energy not a new concern, so is the demand for strategies to address the situation. New generator and fuel technologies should be at the forefront of this, but following COVID-induced disruption and current market flux, stakeholders may be reluctant to opt for permanent solutions.
“The importance of hire options and engaging external expertise therefore cannot be underestimated at this critical moment. By looking beyond traditional grid-based solutions and opting for responsive energy provision strategies based on temporary equipment, manufacturers currently under threat could gain the flexibility required to navigate an uncertain future.”
To download Aggreko’s full report, ‘Energy in Manufacturing: A Flexible Future?’ visit: www.aggreko.com/en-gb/energy-in-manufacturing.