Renew On Line (UK) 31

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

£100m more for New Renewables

In March Tony Blair told a WWF conference at the Royal Institute of International Affairs that new renewables, like offshore wind and energy crops, would be given a further £100m in capital grants, with solar PV and wave power now also benefitting. Reactions were positive. Greenpeace called it a‘very welcome first step’. Soon after came the news of 18 new offshore wind projects (see later) so the timing was good!

Blair said he wanted Britain to be a leading player in the coming green industrial revolution. ‘We have many strengths to draw on. Some of the best marine renewable resources in the world - offshore wind, wave energy and tidal power. A strong science base, supporting world-class research in biomass generators, micro technologies such as small wind and gas turbines, domestic CHP based on Stirling engines, fuel cells and other technologies for the storage of energy. We have led the way in integrating environmental and economic goals within a liberalised electricity market. And we are leading the thinking in Europe on how to remove the regulatory barriers to development of renewables.’

Not everyone would agree with the latter point, but it is certainly good to see wave and tidal power also now on the shopping list. But what about funding? Blair said that he thought the role of Government was ‘to accelerate the development and take up of these new technologies until self-sustaining markets take over. The Government's programme for incentivising renewables will create a new market worth over £500 million through the Renewables Obligation, Climate Change Levy exemptions and the Non Fossil Fuel Obligation. We have already announced £100 million to support offshore wind and energy crops’.

He added ‘Last year I asked the Performance and Innovation Unit to undertake a major study into the future of UK renewable energy.’ and he said he was now providing ‘a further £100 m to support those technologies identified by the report. I know that a number of green groups have been campaigning for a target of 100,000 solar PV installations. This new money will help us to promote solar PV, give a boost to offshore wind, kick start energy crops, and bring on stream other new generation technologies’.

He concluded ‘this investment in renewable technology is a major down-payment in our future, and will help open up huge commercial opportunities for Britain’.

PIU looks 50 years ahead

The detailed allocations of the £100m will await a report by the Cabinet Office’s Performance and Innovation Unit due later this year. This will also include a Renewables Strategy for the next 50 years. We will be reporting on the PIU’s work in Renew 132

Budget backs Renewables

In his budget in March Gordon Brown increased the level of support for new renewables, by announcing the addition of an extra £100m for capital grants for new projects, as had just been indicated by Tony Blair, this being in addition to the £100m announced last year for new renewables. So now, taking into account already announced arrangements, here are the Budget reports view of the package:

‘The Climate Change Levy exemptions for new forms of renewable electricity will provide extra encouragement to generators of renewable energy. This is additional to the capital grant funding of some £100 million over the next three years arising from the 2000 Spending Review and support from the New Opportunities Fund, as well as the Renewables Obligation currently being finalised by the Department of Trade and Industry, which will require electricity suppliers to secure a specified proportion of electricity from renewable generators. To further develop this market the Government has also announced a new £100 million fund that will be used to promote environmental technologies, including additional support for renewables, such as off-shore wind, energy crops and solar power.’

In addition Brown announced plans for a new Green Technology Challenge which will provide funding to follow up the new first-year capital allowances described above, so as to encourage investment in energy-saving technologies and products. The Government therefore proposes to consult, during the summer, on setting up a Green Technology Challenge (GTC), with the intention of offering ‘enhanced first-year capital allowances for further environmental objectives and new technologies. The GTC will also be designed to complement the steps being taken as a result of the Green Fuels Challenge’. See later for more on the latter.

Overall it’s a useful package, although still tiny compared say to the £1.7bn concession to the road lobby- and why couldn’t Labour have done this four years ago? But election politics rule and maybe we shouldn’t complain. For subsequently, new Energy Minister, Peter Hain, announced a £55.5m allocation to the DTI’s renewables R&D programme- a welcome increase from the pathetic £11m it had fallen to under the previous administration.

Overall the DTI say that there is now more than £250m allocated to renewables over the next three years- including the extra £10m for PV solar that Hain announced later. Not bad!

The total allocation now looks like this:

£50 million National Lottery money mainly for offshore wind and energy crops

DTI’s £55.5 million for the Government’s enhanced renewable energy R&D programme

DTI’s £39 million support for offshore wind announced by the Prime Minister in October last year;

£100 million for green energy announced by the Prime Minister in March

MAFF’s £12m in grants for planting energy crops.

Hain steps in

Peter Hain, the new Energy Minister, kicked off his reign by announcing that companies setting up new offshore windfarms could have a one-stop-shop at the Department of Trade and Industry (DTI) to sort out the consents they need. He published a consultation paper spelling out the Government's proposals for trimming the procedure and for ensuring the environmental impact of these projects is considered fully. The existing arrangements were fragmented with developers having to make up to seven different approaches to gain the consent they need. The DTI will now act as a one stop shop, receiving the application, distributing the information to other consenting bodies and managing the whole exercise.

In addition, he has allowed NFFO 3,4 and 5 projects to relocate if they face local planning problems, which should help on-land wind and other stalled projects.

Hain saw wind as ‘a vital part of our commitment to clean and renewable energy. But we will only drive this forward with full respect for local opinion. Our one-stop-shop emphasises our commitment to boosting this important new source of green energy while at the same time ensuring that the effect on the environment is properly assessed and that local views are fully considered’.

Subsequently, after his announcement of £55.5m for R&D on new renewables, at at meeting of PRASEG, the Parliamentary Renewable and Sustainable Energy Group, he launched the DTI‘s analysis of the responses to the consultation on the Renewables Obligation (R0). This, surprisingly, noted that only 20% of the 200 or so respondents were against the inclusion of waste combustion in the RO, so the DTI may reverse its decision to exclude it, given that if it was excluded the 10% by 2010 renewables target might be unattainable. Otherwise the respondents seemed to broadly agree with the DTI’s plans, including the 3p/kWh buy out price, the only quibble being that Oct might be too early for the RO to start - April 2002 was suggested as better. But Hain seemed unwilling to shift the date. Overall, he seemed keen to press ahead fast with renewables. Thus, responding to complaints from the Country Landowners Association about the delay in providing funding for energy crop projects, he said ‘we haven’t been up to speed and we should have been’.

The DTI is to respond to the RO consultation in May

UK to catch up on PV ?

The UK is to launch a major demonstration programme for photovoltaic solar, according to the DTI’s new White Paper on ‘Enterprise, Skills and Innovation’, so that it will be "in line with" world leaders Germany and Japan. The latter has a national target of installing PV on 70,000 roofs by 2002, while Germany is aiming to have 100,000 solar roofs by 2003- compared with the existing UK target of 100 roofs.

Social housing refurbishments were cited as being "one of the key target groups" for the new UK programme. According to the DTI "we can use PV to help alleviate fuel poverty as well as helping us to achieve security of energy supply & environmental objectives".

The DTI say that the programme will also encourage research and manufacturing investment, as well as development of thin film PV technologies by UK firms "thus giving them a lead in exploiting overseas markets as well". £10m over three years has been mentioned to pump prime a 70,000 roof programme.

The announcement was welcomed by solar consulting firm Solar Century, which claimed that "a new British industry is [now] on its way".

http://www.dti.gov.uk/opportunityforall/pages/chapter4.html