Renew On Line (UK) 29a

Extracts from the Jan-Feb 2001 edition of Renew
These extracts only represent about 25% of it

1. Renewables Obligated

Tony Blairs ‘Richer and Greener’ speech to the CBI -Green Alliance environmental policy conference last Oct promised a new deal on the environment. "it is time to re-awaken the environmental challenge as part of the core of British and international politics". And he backed this up with some extra spending on, amongst other things, renewables - including £50m for offshore wind and energy crops and £13m for the DTI’s renewable programme: see details later. It’s welcome news.

For its part, the Department of Trade and Industry’s new consultation document concerning the Renewables Obligation provided some details, but it also created quite a stir with its proposal to exclude energy from municipal waste incineration, as well as large hydro, from the obligation. The exclusion of large hydro had already been trailed, but the proposed exclusion of waste combustion came as a shock to waste combustion interests. It would mean that power from waste combustion projects would not count against the Obligation, so there would be much less incentive for energy supply companies to use this source. In particular, several green power retail schemes include waste combustion in their portfolio - waste combustion is one the most economic options. DTI minister Stephen Byers commented ‘We are proposing to focus support on the renewables that need it most. That is why we intend to exclude large-scale hydro and energy from waste incineration from the Obligation. We are also proposing capital grants to help early offshore wind and energy crops projects compete in this new market’. The DTI announced that £51m would be available, and then came Tony Blairs announcement of futher allocations - some of it, the media noted, being ‘lottery’ money.

Clearly though the DTI has had second thoughts about waste combustion. On the question of the new EU Directive’s Renewables Targets, Mr Byers said: "At a time when the question of whether energy from waste incineration should be included in national targets for renewables is under consideration in Europe we would particularly welcome views on this issue during the consultation."

However, there could also be problems nearer to home. Perhaps 165 new waste incinerators are said to be needed to meet the governments waste targets, and many of these would presumably involve energy recovery, to help offset the cost. But it seems likely that this programme would be met with massive local opposition from residents and environmental groups worried about emissions. As we suggested in Renew 128, it could be that the DTI wants to distance its energy programme from this contentious waste management programme.

The DTI also published its overall Sustainable Development Strategy, which it says shows how it intends to ‘integrate full environmental protection and improved resource productivity into its core mission of improving UK competitiveness’ (see below). The DTI claims that ‘ the success of the strategy will be measured, for example, in terms of reducing the level of greenhouse gas emissions and levels of waste disposal relative to GDP’. However, as the proposed exclusion of waste combustion illustrates, there can be conflicts between waste management and energy recovery strategies. And also within the energy programme. For example, customers choosing to pay premium prices for green power will presumably not want their money to be used just to help their energy supply company meet their Renewables Obligation (RO). Green consumers may expect something extra - projects that wouldn’t otherwise have gone ahead. It could be that, if waste combustion is outside the RO, some green power retailers will decide that this will be a good source to use - since it would be clearly’ additional’ to their RO effort. However green consumers may not be happy with this source being used - if past views are anything to go by. A receipe for conflict? See our discussion later.

The DTI report talks of attempting to capture the same ‘environmental value’ for green power used for the Climate Change Levy and the Renewables Obligation, but notes, in almost impenetrable prose, that ‘whether the voluntary market value will be additional to either or both the CCL values or RO values has yet to be decided’. But it does say that it is important that consumers have accurate information ‘on the relationship between suppliers obligation and the the voluntary tariff.’