FTSE 100 Company

FTSE 100 manufacturer on track for 25 years of secure, long term, low carbon energy.

The Customer

PEP’s customer, a FTSE 100 company operating globally, puts a strong emphasis on making a positive economic, environmental and social impact, and has core values that include protecting the planet and supporting communities. The company’s business involves nine manufacturing sites, including two long-established factories in the UK, that use significant amounts of electricity and gas for industrial processes.

The Challenge

The company has set itself ambitious targets for renewable energy use and a firm timetable to achieve net zero. It was exploring on-site generation at one of its UK facilities in 2021 when a trusted engineering supplier recommended a discussion with PEP. PEP’s site assessment found very limited scope for meaningful generation on-site. However, assessing the surrounding area identified nearby land that could be suitable for over 10MW of combined wind and solar PV. Early discussions with the landowner proved positive, and PEP started to develop the project’s requirements and opportunities.

The Project

Together with the client, PEP analysed its low, medium and high temperature heat demands and the hourly profile of electricity consumption. Comparing the hourly forecast production of renewable energy to consumption enabled PEP to model the amount of over-supply that could be exported to the grid.

PEP advised that a certain combination of wind and solar PV could achieve 85% displacement of grid electricity and gas, with good economic returns.  Both grid supplies would be retained, with surplus renewable electricity being exported to the grid under an offtake agreement to supply the company’s second UK factory.

There is potential to improve the on-site displacement of gas and grid electricity in the future by using heat and electrical storage to supplement the renewable energy. That said, an 85% target was regarded as a strong start with proven technology.

The Solution

While the company’s approach to the energy transition is bold and comprehensive, developing renewable energy projects is something that falls outside its capabilities. As a result, the client asked PEP to jointly manage the whole process. This has involved securing an export offer for grid connection, agreeing commercial terms with the landowner, and conducting comprehensive environmental studies.

PEP mobilised and managed its wider network of specialist advisers, in environmental studies, legislation and logistics, to ensure successful project scoping and delivery.

The project will feature three wind turbines, and around 10 hectares of solar panels, providing a total generating capacity of around 20MW which will significantly reduce the company’s reliance on gas and grid electricity. A suitable transport route for the large wind turbines was identified early in the process.

PEP also led on local engagement with the public and councillors, bringing in a professional communications company with renewable energy project experience to work with the client. The team is also exploring how surplus energy could be used by neighbouring businesses and community organisations.

Both informal and formal consultations have been extensive and reassuringly positive.  The project is now being made ready for a formal planning application to be submitted, with very substantial environmental and social content pre-agreed with the planning authority.

The Benefits

Delivery of the approved project will mean a huge leap towards the company meeting its ambitious UK carbon reduction targets.  Ownership of in-house renewable energy will provide the company with control, and the investment will provide secure, long term, low carbon energy for 25 years with a tight control over cost.

The wind and solar supplied from the nearby site is among the lowest cost, lowest emission energy available in the UK. It provides the most predictable pricing over the near, medium and long term as all its costs can be contracted and controlled. What’s more, the raw energy sources are natural and have no cost.

This means that the company’s manufacturing facilities will be largely immune from rising and volatile global energy markets, providing a more secure and low carbon future for employees, the company’s shareholders and local businesses and community organisations.