Part of the debate – in the Senedd at 6:16 pm on 17 October 2018.
Thank you, Deputy Presiding Officer, and thank you, Lee, for bringing forward this short debate today. I'd also like to welcome the work of the Institute of Welsh Affairs' Re-energising Wales project. The work considers how we could meet 100 per cent of our energy demand from renewables by 2035, and the benefits this could offer for Wales. I await the outcomes of their research with interest.
Last year I set an ambitious target of generating 70 per cent of Wales's energy consumption from renewable sources. Achieving 100 per cent renewable generation would be very challenging and could leave us relying on our neighbours to keep the lights on in Wales.
Last week, the Intergovernmental Panel on Climate Change released a very hard-hitting report on the impacts of global warming. This highlighted how limiting warming to 1.5 degrees rather than 2 degrees would offer multiple benefits for food and water supplies, human health and the environment. To limit global warming to 1.5 degrees, the IPCC recommend we need to scale up renewable generation rapidly to provide around 85 per cent of the world's electricity by 2050. This would be supported by nuclear and fossil fuels with carbon capture and storage. IPCC state gas is likely to generate around 80 per cent of electricity worldwide to provide flexibility and security. Limiting emissions would require carbon capture and storage, and this technology is as yet unproven.
In its national infrastructure assessment, the UK National Infrastructure Commission recommended the energy system should be running off at least 50 per cent renewable generation by 2030, as part of a transition to a highly renewable generation mix. The commission's modelling showed delivering a low-carbon electricity system for 2050, powered mainly by renewables, is a low-cost option.
In Wales, we are already acting on climate change through the Environment (Wales) Act 2016, where we have legislated to reduce emissions by at least 80 per cent by 2050. I will be asking the Assembly to approve our interim emissions targets to 2050 and our first two carbon budgets later this year. Our focus is now on the actions we need to take to deliver against our targets. We are developing our evidence base to inform the development of our first low-carbon delivery plan, which will be published in March next year.
I've raised concerns with the UK Government about their decision to exclude onshore wind and solar technologies from contracts for difference, the proposed closure of the feed-in tariff, and the lack of funding to support wave and tidal technologies. These support mechanisms have driven the mass uptake of renewable generation and enabled dramatic cost reductions. We need the UK Government to review the current subsidy regime so it reflects the importance of onshore wind and solar to an affordable energy mix.
In Wales, we're working to promote and enable renewable energy and this work is taking effect. Renewables generated enough electricity to meet 43 per cent of consumption in Wales in 2016, and indications are this has risen further to 48 per cent in 2017. This summer, the Minister for Environment attended the inauguration of the Brechfa Forest West windfarm and launched the £460,000 annual community investment fund. The Welsh Government woodland estate also hosts Pen y Cymoedd, which is the largest onshore wind project in England and Wales. In addition to the work the Crown estate, with whom I met this morning, is undertaking for potential new leasing, it has also identified potential for an extension to the existing Gwynt y Môr offshore windfarm.
Renewable energy generation on its own, however, does nothing to decrease our carbon emissions. We must remove fossil fuel generation in order to decarbonise. Currently, Wales hosts 19 per cent of the UK's gas-fired electricity generation capacity. However, we use less than 6 per cent of the UK's total electricity. Eighty-two per cent of the electricity generated in Wales last year was from coal and gas. We are considering how much gas generation Wales should host in the future and the levers we have available to manage this. Decisions on future nuclear plants will be taken at a UK Government level. Wylfa Newydd will provide valuable low-carbon base-load energy for the UK system. However, if Wales is to host such strategic energy projects, they must provide wider economic, social and environmental benefits to Wales.
Moving towards clean energy also requires action to move away from fossil fuel extraction. I'm committed to taking action to prevent Wales being locked into further fossil fuel extraction through onshore unconventional oil and gas, such as shale or coal-bed methane.
By the end of this year, I will be launching a comprehensive update of 'Planning Policy Wales'. In response to Jenny Rathbone's question, I'll be doing PPW's revised edition before the end of this term. As you know, we are looking at a review of building regulations that will go into early next year. As part of the revision of PPW, I will strengthen planning policy in relation to the extraction of onshore unconventional oil and gas. PPW will be a key part of our stronger national policy to promote renewable energy. I want local planning authorities to see renewable resources as valuable assets. We've introduced new requirements for local authorities to identify areas for new wind and solar generation and to set local targets for renewable energy in their plans.
The national development framework and the national marine plan for Wales provide us with an opportunity to consider the infrastructure we need to deliver a decarbonsied economy. For the NDF, we are working to identify onshore wind and solar resources in Wales, the impacts of harnessing them, and the most appropriate areas for generation to be encouraged. Similarly, for the marine plan, policies will be developed to harness sustainable marine renewable energy. However, given the electricity that Wales already exports, new generation must deliver sufficient benefit to justify Wales hosting it.
Research undertaken by the Centre for Low Carbon Futures, across a range of global city regions, shows significant export of economic value simply by paying energy bills. In the UK regions studied, this was between 5.9 per cent and 18 per cent of gross value added being exported. Locally owned generation provides a strong opportunity to retain money in the local economy, contributing to prosperity. This is why I set a target for 1 GW of locally owned electricity generation by 2030 and an expectation for all new developments to have an element of local ownership from 2020. Our policy position on renewable energy must deliver the purpose of retaining benefit locally whilst not acting as a barrier to new generation. Our call for evidence on local ownership closed in the spring and I will publish our response next month.
We will be supporting regional energy planning through the energy atlas. This will be a tool to help local authorities and others realise the central role of decarbonisation in planning for the future of their areas. Regional energy planning will need to encompass electricity, heat and future developments, such as increasing demand for power from electric vehicles. The roll-out of electric vehicles requires infrastructure, as Lee Waters referred to, and we are working with the National Grid and two distribution network operators in Wales to support their work to understand the impacts of expanding the charging infrastructure in Wales.
We also need to understand more about how a smart and interconnected energy system will work in practice. We are fortunate in Wales having SPECIFIC and FLEXIS—EU-funded initiatives that have brought together expertise from our universities to inform innovative developments in energy positive buildings and smart living. We are complementing this with our work on the smart living demonstrators.
I've proposed a debate, Deputy Presiding Officer, for 20 November, during which I would like us to explore what role Wales should play in the UK and global energy marketplace. It would be helpful to explore the levels of generation Members think we should be looking for. This is important as we will need collectively to exhibit strong leadership to deliver these changes and secure maximum benefits for the people of Wales. Diolch.