A new report from Policy Exchange details the growing fiscal and economic opportunity cost of the growing power grid congestion holding back the UK’s world-class wind fleet

In the absence of sufficient transmission capacity, the UK is losing one billion pounds a year because of system constraints. By the time planned solutions are implemented next decade, the cost of curtailment will have increased to an annual £3.5bn

Research conducted by Policy Exchange with assistance from LCP Delta finds that in 2022 the volume of wasted wind generation was sufficient to produce over 118,000 tonnes of green hydrogen, rising to 455,000 tonnes by 2029 Between 2021-22 congestion payments cost over £350 million.

The report calls on Westminster to encourage electrolyser adoption in heavily curtailed areas to leverage this wasted energy and supercharge our nascent hydrogen economy. Through modelling conducted with LCP Delta, the report determines that electrolysing the UK’s wasted renewable energy could create enough hydrogen to:

• Displace two-thirds of the 700,000 tonnes of the UK’s current, carbon-intensive grey hydrogen consumption annually;
• Decarbonise the entirety of the UK’s 7m tonne annual steel manufacturing;
• Meet over 90% of our national Sustainable Aviation Fuel (SAF) target for 2030; or
• Deliver two thirds of our electrolyser production capacity target for 2030