The global energy market continues to evolve rapidly, shaped by regulatory scrutiny, technological innovation, and shifting cost dynamics. This February 2026 update highlights key developments across the UK and international markets.
Members of Parliament cast doubt on Drax’s sustainability
The UK Government is under pressure from a cross-party group of MPs to suspend the subsidies, approximately £2 million per day, it currently receives, as doubts were cast on its sustainability claims. This pressure stems from the release of documents at a recent employment tribunal, where internal whistle-blowers privately raised concerns that the company did not have sufficient evidence to support its claims.
Drax currently receives this subsidy on the condition that it generates electricity from biomass pellets made from waste or low-value wood sourced from sustainable forests.
Drax has consistently and publicly denied these allegations. However, the company announced on Thursday 26 February that it would stop burning pellets from British Columbia, where scrutiny first emerged, within the next 12 months. This move highlights the growing regulatory and reputational risks associated with supply chain transparency in the biomass sector.
First geothermal power plant goes into operation in the UK
The United Downs deep geothermal power project, based in Redruth, Cornwall, came online on 26 February 2026. The power plant generates electricity by sending water approximately 3 miles (5 kilometres) underground, where it is heated to nearly 200°C using the earth’s natural heat. The resulting steam powers turbines and is expected to generate electricity for up to 10,000 homes.
The plant cost £50 million to build, but it has an advantage over other types of renewable energy. As the heat is sourced from within the earth, it provides a continuous supply, unlike solar or wind generation.
The project has also identified that when the water returns to the surface, it contains high concentrations of lithium. The developers aim to produce around 100 tonnes annually, enough to manufacture approximately 25,000 electric vehicle batteries.
China’s Green Hegemony
China’s transition into a global green energy superpower continues at an unprecedented pace. In 2010, total solar capacity stood at approximately 0.1 GW, enough to power around 100,000 homes.
This has since increased to 574 GW, and by the end of this year, China is planning to add a further 768 GW of capacity.
This aggressive expansion has positioned China as the dominant force in green technology and manufacturing. A single Chinese facility now produces one in every seven solar panels manufactured globally.
With significant investment in green technologies, China generated approximately £1.6 trillion in related economic activity in 2025, equivalent to the GDP of countries such as Brazil or Canada.
Analysts suggest that it could take other countries decades to match this scale.
Clean energy costs show mixed signals
Energy storage costs have fallen to their lowest level on record, with BloombergNEF’s (BNEF) Levelized Cost of Electricity 2026 report identifying a significant year-on-year decrease. This reduction is largely driven by declining lithium-ion battery prices, which could accelerate the deployment of co-located renewable projects that combine generation with storage. Currently, only 12% of onshore renewable projects in the UK are co-located.
Meanwhile, global costs for solar, onshore wind, and offshore wind increased in 2025, with supply chain constraints cited as a major contributing factor.
However, BNEF expects that continued innovation and increased competition will drive costs down again by 2035.
Key UK power link upgraded between England and Scotland
National Grid recently completed work to upgrade electricity transmission lines near Carlisle, strengthening the cross-border link between England and Scotland. These improvements are intended to increase the volume of electricity that can be carried between the two regions as additional renewable generation comes online.
NUS Consulting Group continues to monitor these developments, supporting organizations in navigating energy price volatility, procurement strategy, and sustainability risk across global markets.