Tag Archives: british
More Can Be Done For Biomass Says The REA In Response To Government Energy Announcements
Robin WhitlockThursday, 27 June 2013 The poor settlement for biomass sends a very bad message over the Government’s long term support for this sector says the Renewable Energy Association (REA) The government has announced details of measures it intends to implement in order to keep the lights on in the UK and energy prices down as well as action to unlock up to £110 billon of energy infrastructure investment by 2020. The government claims the measures would support an estimated 250,000 jobs while also enabling the provision of flexible energy and helping renewables to contribute more than 30 percent of total power by 2020. Chief Secretary to the Treasury, Danny Alexander, and Energy and Climate Change Secretary Edward Davey, today announced more details concerning the reforms to be implemented by the governments Energy Bill which is currently making its way through parliament. These reforms are intended to give developers and investors the confidence they need to progress with new projects at a time when huge investment needs to be made in Britain’s energy infrastructure Around a fifth of Britain’s ageing power plants are due to close over the coming decade with further closures in the 2020s and recent Ofgem updates anticipate that the buffer between peak demand and supply could in fact be lower than previously expected. The government intends to introduce Capacity Agreements under the new Capacity Market, alongside long-term Contracts for Difference (CfDs) for low-carbon power which will make it cheaper to deliver low-carbon generation. The Capacity Agreements are intended to boost energy supplies into the next decade while protecting consumers against volatility in market prices. Similar capacity markets already operate in the US and a number of EU countries with another currently being introduced in France. In addition to the Capacity Agreements, Renewable Strike Prices will be available from 2014 to 2019 for renewable electricity generation including onshore and offshore wind, tidal, wave, biomass and large-scale solar. The Strike Prices will also remove price volatility risk but are specifically aimed at electricity generated from low-carbon sources under CfDs. Support for the Strike Prices comes from the £7.6 billion Levy Control Framework, a cap to limit the costs passed on to consumers through long-term contracts. The LCF covers all of DECC’s support mechanisms for low-carbon energy generation and will be set at £7.6 billion in 2020-21 starting in 2015-16 at £4.3 billion. “No other sector is equal in scale to the British power market, in terms of the opportunity that it offers to investors, and the scale of the infrastructure challenge” said Ed Davey. “Our reforms will renew our electricity supply, attracting up to £110 billion investment in a mix of clean, secure power and demand reduction, and will support up to 250,000 jobs up and down the supply-chain. The Capacity Market will incentivise investment in new gas plant and other flexible capacity to maintain an adequate supply margin – the safety blanket over and above expected demand – for 2018 onwards. Ofgem and National Grid will consult on possible steps they could take to ensure that mothballed power plant or demand response is available if needed in the middle of the decade. The Strike Prices for renewable technologies announced today aim to make the UK market one of the most attractive for developers of wind, wave, tidal, solar and other renewables technologies, whilst minimising the costs to consumers. This will help boost home-grown sources of clean secure energy, and enable us to decarbonise the power sector, with renewables contributing more than 30% to our mix by the end of this decade.” Responding to the government’s announcements, REA Chief Executive Gaynor Hartnell said that the really striking thing about the draft Strike Price list is what has been omitted from it, particularly dedicated biomass technologies. She said that the REA will be pushing for clarification on these as soon as possible given that a cap has been imposed for dedicated biomass under the Renewables Obligation (RO). “There are hundreds of megawatts of biomass projects looking to commission under the new support regime and their contribution of clean, baseload electricity will help keep the lights on when the capacity crunch comes” Ms Hartnell added. “This is a technology with a long-term role to play. It helps with the objective of keeping waste wood out of landfill and is a good use for agricultural by-products such as straw and chicken litter. In the long term, when coupled with carbon capture and storage, this technology could actually be carbon negative. Biomass has been a mainstay of renewable energy policy since the mid-1990s and over the last few months biomass projects have been encouraged to apply for CfDs. It would be inconceivable and nonsensical for Government to turn its back on this technology.” Ms Hartnell added that capping the amount of biomass projects is profoundly unhelpful when there is an impending capacity crunch and given the international market in debt financing for renewables. She also pointed out that lenders look at the UK regime and are questioning its reliability. Capping biomass is not, therefore, the right message when tens of billions of pounds of investment in renewables is required. In a separate announcement, the government has also released estimates of the amount of shale gas in the UK in order to give industry and regulators an indication of how best to plan future exploratory drilling. The government intends to introduce reforms enabling shale gas exploration alongside a package of community benefits in areas where shale gas is commercially extracted. While accepting that shale gas would, subject to public approval, be better than reliance on imports, the REA warned that development of shale gas resources should not be a distraction from renewables. “The UK needs eventually to produce electricity with virtually zero carbon emissions” said Ms Hartnell. “If shale gas can revolutionise our economy, we must invest the proceeds in building a resilient energy system for the future, dominated by renewables.” In relation to renewables targets Ms Hartnell further pointed out that the UK has the most demanding target of all the EU Member States and that the prospects for getting on track to meet 15% in 2020 seem remote. “The effect of a steep drop in lending decisions taken in 2008 will manifest itself, there will inevitably be a hiatus with the closure of the Renewables Obligation and the Government seems to have gone lukewarm on renewables” she said. “It is important that the UK meets its renewables target in the most cost-effective way possible. Heating from biomass is one of the cheapest means of doing this. This poor settlement, coupled with next week’s tariff reductions for medium scale biomass installations, sends a very bad message over the Government’s long term support for this sector. The UK needs a massive expansion in renewable heat to meet climate change objectives – which will create jobs and growth all along the supply chain. The Government should be doing all it can to get the RHI back on track, not cutting its budget.” Further information: Department of Energy and Climate Change (DECC) Renewable Energy Association (REA) Continue reading
EU Ministers Pave The Way For Historic CAP Reform Deal
26 June 2013 | By Alistair Driver REFORM of the Common Agricultural Policy (CAP) that will enshrine the ‘concept’ of greening of direct payments is likely to be confirmed in Brussels later today. EU Ministers, under the chairmanship of the Irish presidency of the EU, signed off its position at a meeting in Luxembourg late into Tuesday night, following two days of exhaustive talks. The Irish Presidency will now take the revised CAP proposals to Brussels to be passed by the full European Parliament in a meeting later on Wednesday. A press briefing is scheduled for approximately 4pm when the parties leading the negotiation hope to announce the broad political deal. This would not be the end of, however, as the detailed legal text is unlikely to be completed until the autumn. In some of the key elements of the EU Ministers’ text: Flexibility has been granted for member states regions to green direct payments in a way that reflects national circumstances. Ecological Focus Areas under CAP greening will start at 5 per cent possibly rising to 7 per cent in 2017 . On top of 10 per cent compulsory modulation, Governments can now transfer up to 15 per cent of funds from their direct payment pots to their rural development budgets, without co-financing the transfer, as is the case now.There is also scope to move money the other way. More flexibility has been granted in the move towards area payments. Member states/regions must ensure all payments are within 60 per cent of the national/regional average by 2019. Member states will be able to allocate 8 and 13 per cent (more in some cases with Commission approval) of the direct payment budget on coupled subsidies. The sugar quota regime will go in 2017. The young farmers scheme taking up to 2 per cent of direct payments will be compulsory. The ‘active farmer’ definition will exclude certain land uses with a negative list. Commenting from Luxembourg in the early hours of Wednesday morning, Defra Secretary Owen said the UK broadly supported a mandate agreed by the 27 EU Ministers. He ‘warmly congratulated’ Irish Agriculture Minister Simon Coveney for his work so far in brokering a deal. “Negotiations between 27 agriculture ministers, the EU commission and the European parliament were never going to be easy. We all have different ambitions for CAP reform and the Irish Presidency has had a really tough job trying to get a deal,” he said. He said the UK had got its way in some areas, for example ‘blocking a host of regressive proposals that would have meant a very bad deal for British farmers and taxpayers’ but not others. “We want to get the best possible reform for our farmers, taxpayers and consumers whilst delivering a better outcome for the environment,” he said. He said the UK, backed by Germany, ‘resisted every step of the way’ planned market organisation reforms driven by French MEP Michel Dantin that would have taken the CAP ‘back to the dark days of butter mountains and wine lakes, with costly interventions in the market’. “All along I have rejected moves that would increase costs for hard pressed consumers. British shoppers should not have to pay twice for the CAP – once through their taxes and again at the supermarket tills,” he said. He said pressure from the UK led to ‘significant progress’ to improve measures for the UK sugar industry, bringing the end of quotas back to 2017 rather 2020, as some MEPs were advocating. While this will be welcomed by UK sugar producers Mr Paterson said it was still ‘not enough’. Sugar beet quotas are bad for business and bad for consumers, driving up the wholesale price of sugar by 35 per cent and adding 1 per cent on our food bills. The case for better access to cane sugar is still being negotiated thanks to our efforts,” he said. He said there is now ‘absolute clarity from the Commission that each of the four parts of the UK can implement CAP as they see fit’, he added. “Farmers in England, Northern Ireland, Scotland and Wales can be reassured that their governments have the complete freedom to deliver a CAP tailored to their needs and circumstances. This successful outcome is a result of working as a united force with all Devolved Administrations and respecting regional farming priorities. I am pleased we have been able to agree changes needed for all four countries,” he said. He welcomed the ‘further gains’ to secure flexibility on greening measures to benefit the environment and UK farming but expressed anger that UK efforts to block ‘coupled payments at a high level’ had failed. He said coupled subsidies, which Scotland and possibly Wales are likely to utilise under the reformed policy ‘create market distortions, are a poor use of tax payers’ money and discourage trading in a competitive open market’. He concluded: “I hope the negotiations will be completed today in Brussels, providing much needed certainty and clarity for farmers.” EU Agriculture Commissioner Dacian Ciolos said Tuesday’s Agriculture Council gave a negotiating mandate to the Irish Presidency: “Negotiations on CAP reform have made good progress in the past few days, which makes me confident of our capacity to reach a political agreement. We have made important steps forward on each of the four regulations of the legislative package,” he said. “However, there are still open issues on which the European Parliament, the Irish Presidency and the European Commission need to find the right balance. “Trilogues will restart in Brussels tomorrow with the view to finding a political agreement on the CAP reform.” Continue reading
Bluefield Bets On UK Solar Potential With Market Debut Of Fund
By Christoph Steitz FRANKFURT | Tue Jun 25, 2013 (Reuters) – Asset management firm Bluefield Partners is betting that the solar industry has the potential to grow in Britain, while taking a beating elsewhere in Europe, benefiting from favourable laws and a relatively underdeveloped market. Bluefield, which specialises in buying and managing energy and infrastructure assets, plans to list the Bluefield Solar Income Fund ( IPO-BSI.L ) on the London Stock Exchange on July 12 to raise up to 150 million pounds for the acquisition of solar plants in Britain. “The UK is in its infancy compared to markets like Germany or Italy ,” James Armstrong, managing partner at Bluefield, said on Tuesday. “We’re just going into a market that has significant growth potential.” According to figures by European solar industry association EPIA, Britain’s cumulative solar installations more than doubled in 2012 to 1.83 gigawatts. This compared with 32.4 GW in Germany and 16.4 GW in Italy , where lavish incentives for solar power have led to soaring installations over the past few years. Demand in these markets is expected to drop sharply this year, however, as governments reduce the incentives and make investment in solar power less rewarding. Armstrong pointed to favourable legislation in Britain, which said in its updated renewable energy roadmap in late 2012 that its solar market had the potential for up to 20 GW by 2020. Bluefield’s fund aims to invest the proceeds from the initial public offering within 12 months to buy solar plants that it expects will provide stable annual levels of power generation with low operational costs. Armstrong said he expected the fund to grow to about 300 million to 400 million pounds in assets over the next two to three years. Bluefield has clinched deals with British power companies including British Gas Solar, the solar contracting unit of Centrica ( CNA.L ), for exclusive access to solar projects until April 2014. The Bluefield fund will finance solar projects but not build them, reducing its operational risk. Armstrong did not want to disclose plans for concrete investments after the IPO, saying only: “We have a deep and significant pipeline.” (editing by Jane Baird) Continue reading
