The UK government today presented measures to avoid the possible over-allocation of renewable energy subsidies, including a proposal to close the Renewables Obligation (RO) scheme for new solar projects on April 1, 2016.
“Our support has driven down the cost of renewable energy significantly. As costs continue to fall it becomes easier for parts of the renewables industry to survive without subsidies. We’re taking action to protect consumers, whilst protecting existing investment,” commented Amber Rudd, Energy and Climate Change Secretary.
SOLAR OUT OF THE RO
The government is launching a consultation on how to manage the deployment of solar photovoltaic (PV) systems of 50 kW to 5 MW within the RO. It proposes to no longer support that type of renewable energy projects under the programme across Great Britain. The proposed changes would also apply for expansion projects at existing accredited stations.
Systems bigger than 5 MW have already been excluded from the RO from April 1, 2015.
There will be grace periods for certain solar projects, allowing them to enter the RO on or before March 31, 2017. Projects with preliminary accreditation on or before July 21, 2015; and developers who have made significant financial commitments to projects on or before that same date will be able to take advantage of the grace period. Also, the grace period will cover projects facing delays in grid connection outside their control.
The consultation on these proposed RO changes for solar will run till September 1, 2015.
NO GRANDFATHERING FOR SOLAR, BIOMASS
The consultation on solar PV deployment above includes a proposal for the removal of grandfathering for new solar PV projects of up to 5 MW that are not accredited under the RO as of July 21, 2015. This would apply to England and Wales only.
Grandfathering is a policy that once a generating station is accredited and receiving RO support at a certain level, the level would not change for the lifetime of its support under that scheme.
Following an earlier consultation, the government has also taken the decision that the RO support rate for new biomass conversion and co-firing plants and combustion units should no longer be covered by the grandfathering policy in England and Wales. This change will also apply to generating stations or combustion units that are already receiving support under the RO and move for the first time into the mid-range co-firing, high-range co-firing or biomass conversion bands.
Again, there will be exceptions to protect developers who have made significant financial commitments.
FIT CHANGES
The UK government also announced today a consultation on removing preliminary accreditation from the feed-in tariff (FiT) programme across Great Britain. This means that complex projects that take longer to build could face lower-than-expected tariff levels when they reach completion.The goal of that move is to limit the risk to bill payers of an installation surge, the government said. The consultation closes on August 19.
This year, the Department of Energy & Climate Change (DECC) is undertaking a full review of the FiT scheme and will consult on a full package of cost control measures “in due course”.
RECENT MOVES
In line with an election pledge to end new onshore wind subsidies, the UK government last month announced that the RO support regime would also be closed to new onshore wind from April 2016, one year earlier than planned. Rudd has also said that the pledge would be implemented with respect to the new Contracts for Difference (CfD).
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Solar power system. Author: Mountain/ \Ash. License: Creative Commons, Attribution 2.0 Generic.
