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The New Energy Letter: November 2020

Since our last new energy letter, the European Commission has published its long-awaited Renovation Wave Strategy, revealing of the extent of Europe’s decarbonisation ambitions in existing buildings – arguably the most challenging sector to decarbonise. The renovation wave strategy is making ripples, which could become a tidal wave of transformation for our existing building stock, with energy efficiency and the uptake of low carbon heating standing to make vast gains.

But this scale of change will only be unlocked if the market is swept along too – if member states follow through on the strategy recommendations, and if private investment is unlocked at the scale envisaged. So which parts of the renovation wave strategy give me something to be optimistic about?

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Regulation and policy critical to the future of new energy

Delta-EE Director Jon Slowe was recently joined by representatives from the Regulatory Assistance Project (RAP) to discuss the role of policy and regulation in the energy transition.

Regulation and policy play a critical role, both with competitive networks and markets, but they were typically built around old energy. There is now a need to evolve, facilitate and lead the way to new energy.

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How Brussels is pointing the direction for the European energy transition

All personal opinions regarding Brexit aside, there’s no denying that the European Commission and European Union has a huge influence over the energy sector. Recent episode of Talking New Energy, the Delta-EE podcast, focuses on what the latest policy coming out of the EU means for the energy transition. 

As Frauke Thies, Executive Director at SmartEn, explains, organisations such as SmartEn help their members understand the legislation coming out of the European Union and how it affects them. It is not always easy to help countries understand the influence of the EU, but its influence is paramount. Take the Energy Performance of Buildings Directive, for example, which has set the target for member states to achieve nearly zero energy buildings in new builds. In the future this will push towards achieving a renovation of building stock as well. 

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The impact of changes to RHI tariffs on the UK heat pump market

The latest Delta-ee podcast focuses on the impact of the latest changes to the RHI (Renewable Heat Incentive) tariffs and the impact they will have on the UK heat pump market.

Steven Ashurst, Senior Analyst and Micro-CHP Research Service Manager, and Lukas Bergmann, Senior Analyst and Heat Pump Research Service Manager, suggest the changes in tariff point towards a positive future for air source heat pumps.

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Is a European-wide ban on the sale of fossil-fuel heating appliances imminent?

Policy fundamentally dictates the commercial opportunities within a market, and the business models that are viable. With energy policy shifting focus from electricity, towards heating and transport, could the regulatory moves and discussions we are seeing in the transport sector be mirrored in heating?

A plethora of incentives for EVs are now in place across Europe, discussion of the mandatory requirement for every new build to be equipped with an electric recharging point and the outright ban of certain products are underway. Although developments in the heating sector are currently slower moving, the first steps are in place, in particular new build requirements. It is clear that when countries do decide to act, change and transformation can be rapid.

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In the new energy era, policy makers and new business models need each other

Policy makers need new business models as much as new business models need policy makers. This was one unexpected conclusion from some of our latest research on the new business models that are emerging in the distributed energy and connectivity markets we track.

We didn’t set out to prove this thesis. Our main aim of our latest research 'New Business Models for Micro-CHP" (published 16 January) was to develop an effective framework for analysing these business models, and test the hypothesis that they are all about 'getting to volumes' for new innovative (more expensive) home energy products. (More on this in my next blog).

So why do new business models need policy makers?


For new technologies - like micro-CHP, fuel cell or heat pumps - new business models have emerged as a response to:

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Delta-ee Bloggers

Andy Bradley
17 posts
Jan Hughes
98 posts
Stephen Harkin
6 posts
Jennifer Arran
13 posts
Jon Slowe
25 posts
Lindsay Sugden
21 posts
Steven Ashurst
15 posts
John Murray
16 posts
Nigel Timperley
2 posts
Arthur Jouannic
20 posts

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