The findings are published in a new REA report comparing two scenarios: scaling up renewables in line with the UK government’s Clean Power 2030 Action Plan, and a counterfactual scenario in which no additional investment in renewable capacity is made. The Clean Power 2030 framework, overseen by the Department for Energy Security and Net Zero, aims to rapidly expand low carbon generation, modernise the grid and reduce dependence on imported fossil fuels.
According to the REA’s modelling, renewables will undercut gas on a full system cost basis by 2028 to 2029. This calculation includes not only the headline cost of generation but also the associated infrastructure investments required to integrate high levels of renewables into the grid, such as transmission upgrades, energy storage, balancing services and network reinforcement. Even after these additional costs are factored in, the report concludes that renewables offer lower overall system costs than continued reliance on gas fired power.
The economic case for renewables is supported by independent data from the International Renewable Energy Agency, which has consistently found that renewables are now the cheapest source of new electricity generation globally. In its most recent cost analysis, IRENA reported that around 86 percent of new renewable capacity added worldwide in 2022 produced electricity at a lower cost than fossil fuel alternatives, with solar and onshore wind seeing especially sharp cost declines over the past decade.
In the UK context, gas prices have been highly volatile in recent years, particularly following Russia’s invasion of Ukraine, which disrupted global energy markets. The UK’s exposure to international gas markets has had significant consequences for households and businesses, contributing to record energy bills in 2022 and prompting the government to introduce large scale support packages. By contrast, renewable generation, once built, has no fuel cost, insulating consumers from global commodity price shocks.
The REA’s analysis also highlights the employment benefits of accelerating the clean power transition. Following the Clean Power pathway could support nearly 145,000 new jobs across the supply chain, including roles in manufacturing, construction, operations, maintenance and grid services. The UK already has a substantial renewable energy workforce, with offshore wind clusters in regions such as the Humber and Scotland, and further expansion is expected under the government’s net zero strategy.
Matt Parry, head of power and energy demand at the REA, described 2028 to 2029 as the pivotal moment in the organisation’s modelling. From that point onwards, he said, the economics shift decisively. Investment in domestic clean power begins delivering net gains to the UK economy, with job creation and reduced exposure to volatile gas imports accelerating the advantage year by year.
The report’s conclusions align with analysis from the UK’s independent climate advisers at the Climate Change Committee, which has repeatedly argued that a rapid build out of renewables and supporting infrastructure is the most cost effective route to meeting climate targets while strengthening energy security.
Taken together, the evidence suggests that the debate over renewables is increasingly grounded in economic competitiveness as well as environmental necessity. By the end of this decade, the REA argues, renewables will not only be the cleaner option but also the cheaper and more resilient foundation for the UK’s power system.
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