Plans to remove support under the Renewables Obligation foranaerobic digestion (AD)facilities under 5MW from April 1 2013 have been scrapped in a move welcomed by AD operators.
TheDepartment of Energy and Climate Change (DECC) announced yesterday (October 2)that new facilities between 50kW and 5MW will continue to be supported by the scheme.
Under the Renewables Obligation, energy suppliers are required to purchase Renewable Obligation Certificates (ROCs) as part of their requirement to buy a growing proportion of electricity from renewable sources. The system is banded so that some renewable energy technologies receive more ROCs than others to encourage their development.
As part of its RO banding review, published in July 2012, DECC proposed to exclude new small scale AD projects from the scheme as of April 1 2013 (see letsrecycle.com story), subject to a consultation. This would mean that they would only have been eligible for support from Feed-in Tariffs (FITs).
However, following feedback from industry, the Department said it would keep both schemes open for those investing in small scale AD facilities.
“Industry needs certainty, and keeping the current arrangements for small scale renewables as they are will help provide this assurance.”
– Greg Barker
Energy minister Greg Barker said: I am fully committed to spurring on growth in clean green energy generation across the nation and want to provide long term certainty for those who choose to invest.
In light of feedback from industry on our intention to consult on the overlap between the RO and FITs, we believe that now is not the time to make further changes to these schemes. Industry needs certainty, and keeping the current arrangements for small scale renewables as they are will help provide this assurance.
At present, AD facilities get two ROCs per MegaWatt hour (MWh). This level of support will be maintained in 2013/14 and 2014/15 and is set to reduce to 1.9 ROCs per MWh in 2015/16 and 1.8 ROCs per MWh in 2016/17.
Reaction
Plans to remove ROCs support for small-scale AD plants had been branded a disaster by the industry, which raised concerns that the move would undermine investor confidence in the technology (see letsrecycle.com story).
Responding to yesterdays announcement, Charlotte Morton, chief executive of the Anaerobic Digestion and Biogas Association (ADBA), said she was pleased with DECCs decision.
She said: ADBA strongly welcomes this announcement, which will give confidence to anaerobic digestion plants which rely on the RO either as their primary support mechanism or as back up to progress. This sensible decision recognises the huge value which AD can generate for the UK with the right support: tackling climate change, providing economic growth and supporting up to 35,000 jobs.
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We are very pleased with the speed at which DECC has responded to industry concerns, and ministers recognition of the need for certainty to ensure investment in technologies such as AD.
Chief executive of the Renewable Energy Association, Gaynor Hartnell, also welcomed the decision. She said: This decision is most definitely the right one, and will be welcomed by all those in the renewables industry. This is evidence of the Governments willingness to listen to sensible and constructive debate, and the kind of mature working relationship we need to have.
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