On-site & Micro News

Friday 17 October 2008

Trade unionists believe feed-in tariffs will "kick start" the microgeneration industry in the UK

The renewable energy industry has welcomed energy secretary Ed Miliband's announcement yesterday that the government will introduce feed-in tariffs to support small-scale green power projects.

Mr Miliband revealed in his debut speech to Parliament yesterday that the government will add an amendment to the Energy Bill to introduce feed-in tariffs (see this New Energy Focus story).

Feed-in tariffs are effectively long-term contracts that will offer the generators of renewable energy a guaranteed price for their power above the general market rate for electricity.

The government is still backing its Renewable Obligation system for large-scale renewable power projects, particularly since the system will provide more certainty of the UK meeting its renewable energy targets than a feed-in tariff on a large scale.

But the feed-in tariff on a small scale should mean microgenerators and on-site power projects will have a guaranteed premium rate income for their power, providing certainty needed for investment decisions.

"Big boost"

The Renewable Energy Association (REA), which has been lobbying for a feed-in tariff to support smaller green energy projects along with pressure group Friends of the Earth, said it would provide a "big boost" to communities, householders and businesses that want to contribute towards UK sustainable energy targets.

Philip Wolfe, the REA's director general, said it was "vital to give energy users the incentive to become 'part of the solution'".

But he called on the government to ensure it also brings in a feed-in tariff for heat, or includes heat within the feed-in tariff being introduced for electricity.

Mr Wolfe said: "We have proposed a design for the renewable energy tariff so it can support heat and electricity and renewable gas. We hope the new Department of Energy and Climate Change will likewise take this opportunity to meet these policy aims when they draft their Energy Bill amendment."

"Details unknown"

Friends of the Earth also welcomed the announcement on feed-in tariffs, but commenting on Mr Miliband's plans said the details were currently unknown.

The pressure group's climate campaigner, Dave Timms, said: "A comprehensive scheme is urgently needed and must encourage homes, businesses, communities and local authorities to play their part in tackling climate change by developing clean, green electricity and heat.

"The renewable energy potential in Britain is enormous - developing green power will cut our dependency on fossil fuels, slash UK carbon dioxide emissions, increase fuel security and create thousands of jobs," he added.

Trade unionists have also welcomed the government's intention to introduce feed-in tariffs for small-scale renewables. The Trade Union Congress said it would "kick start" a new micro-generation industry in the UK.

TUC general secretary Brendan Barber said: "This is a green answer to the economic slowdown. The government should bring in these powers urgently, so we can catch up with our EU competitors - such as Germany and Denmark - that have tens of thousands of workers in their renewables industries."

80% emissions target

The second major component of Mr Miliband's statement to the Commons yesterday, the plan to increase the UK's climate change target to cut carbon emissions by 80% before 2050 compared to 1990 levels, also received a warm welcome from NGOs and the renewable energy industry.

Michelle Thomas, head of the clean energy and sustainability team at international law firm Eversheds, said the government's move to increase the target was "what it expects its voters want to hear".

Nevertheless, Ms Thomas said yesterday's statement by Mr Miliband was particularly important for organisations taking part in the UK's Round Three offshore wind programme, which is developing projects that could take until 2020 to deliver.

Ms Thomas said: "The UK offshore development known as Round Three will go a long way towards ensuring that the UK meets its renewable energy and carbon emission reduction targets. This requires a significant amount of capital investment and this statement is what those responsible for delivery need to hear right now."

However, energy sector brokers Inenco warned yesterday that it was not clear how the new target would be met.

Ian Parrett, the Lancashire firm's marketing manager, said: "It's still not clear how the original target of 60% was going to be delivered. Whilst we support the setting of aggressive targets, government must engage in the process of delivering the targets as well."

Mr Parrett's firm is now preparing a study of how deep cuts in emissions would impact on life in 2050. He said: "Meeting the EU's 2020 targets already demands unprecedented increases in renewable generation and energy efficiency, but the 2050 target will require a fundamental change in the way that we approach both our working and personal lives."

WWF UK chief executive David Nussbaum said in order to move "swiftly" to a low carbon economy, the government should set a carbon emissions reduction target for 2020. Mr Nussbaum added that the UK should "prioritise action at home, rather than relying excessively on imported carbon credits".