The cost of being wrong is less than the cost of doing nothing

Aileen McLeod, Director of Business Planning and Commercial at SSEN Transmission blogs about her speaking slot at this week's Scottish Renewables' Net Zero Conference and explains why, when it comes to Net Zero, the cost of being wrong is less than the cost of doing nothing.

On Wednesday, Scottish Renewables held its first ever Net Zero Conference and we – the proud winners of Utility Week’s Net Zero Award 🏆 – were one of the sponsors.

It was a diverse event, with sessions covering hydrogen, batteries, oil and gas, the CfD and wider subsidy regime and, of course, the critical role of the grid. A colleague commented to me at lunchtime how much unanimity there was in the room about the case for decarbonisation and the urgency in accelerating the UK’s transition. As it has been two years without face-to-face events, we perhaps underestimate how much the ‘mood’ of the energy industry has shifted towards a ‘green’ consensus.

It is welcome to see the growing recognition of the essential role of networks in the transition. Earlier this week, the well respected think tank Sustainability First made ten recommendations for a sustainable UK energy security strategy that (rightly) linked renewables with network investment. At the Conference, developers with common voice supported the case for urgent transmission investment particularly from Scotland (where electricity is made) to England (where electricity is used).

I got a chance on the final panel session at the Conference to put some facts and figures behind the case for transmission investment. The net zero analysis we know well. Perhaps less known is the current activity and costs for balancing the system, which topped £500 million in the month of November last year. A significant proportion of that is due to constraints in Scotland. While you can’t simply extrapolate between balancing costs and transmission capacity, there is no doubt that a shortage of transmission investment is costing consumers. It reminded me that we always need to think about the ‘big picture’ of the whole energy system as decisions made for networks have impacts in the energy market.

I titled my presentation “the cost of being wrong is less than the cost of doing nothing”. That is certainly the case in the context of net zero. Not acting now passes costs and consequences onto future generations. Better to avoid greenhouse gas emissions now than try to sequestrate later.