Legislation News

Friday 24 October 2008

Friends of the Earth wants a feed-in tariff to help communities and businesses to get involved in microgeneration, not just householders (photo: solarcentury.com)

Microgeneration and renewable heat technologies are as important as large-scale electricity generation in meeting the UK's renewable energy targets.

That was one of the main conclusions of today's report from the House of Lords EU sub-committee, which summed up the findings of an inquiry earlier this year into the UK's chances of meeting its 15% renewable energy goal being set by Europe for 2020.

The committee chaired by the former rail privatisation minister, Lord Freeman, said microgeneration grants should be increased and a new system of grants introduced for renewable heat.

Microgeneration

The Lords disagreed with the government view that microgeneration will not have a large part to play in meeting the 15% target, suggesting that projects smaller than 50kW electricity and 45kW heat generation "have the potential to contribute significantly".

It was noted that household energy generation systems help raise awareness of energy use and energy efficiency among householders.

The biggest barrier highlighted was the potential cost of microgeneration systems proving unpopular, but the Lords noted that costs were generally compared to centralised fossil fuel power plants, and that if fossil fuel prices rise, microgeneration becomes more attractive.

Next week should see the government publishing details of its proposed feed-in tariff for electricity microgeneration, as a proposed amendment to the Energy Bill currently going through the Lords, which would also help with the financial aspect of household power systems.

A feed-in tariff involves a long-term contract for renewable energy produced by small-scale power generation systems above the market rate for electricity.

The British Wind Energy Association (BWEA) told reporters this week that it is arguing for a cap on an electricity feed-in tariff to limit it to projects below 500kW in size, in order to protect the existing Renewables Obligation incentive for larger green power installations.

Friends of the Earth said last night that the government should listen to the Lords committee and introduce a "comprehensive" feed-in tariff that encourages farmers, communities and businesses to get involved in green power generation, not just households.

Campaigner Robin Webster said: "If the Government gets it right the UK could become a world leader in the development of small-scale green energy - creating new green collar jobs and a booming new industry."

Renewable Heat

Meanwhile regarding renewable heat, the Lords committee called today for more commitment from the government than was currently the case.

Just 0.6% of heat energy in the UK comes from renewable sources, with the government suggesting a 14% target within its draft Renewable Energy Strategy.

While electricity sector organisations like the British Wind Energy Association dismissed the contribution of renewable heat to the UK's renewable energy target during the Lords inquiry earlier this year, organisations like Centrica said there was significant scope for achieving increased renewables deployment through renewable heat.

Furthermore, the Lords said witnesses to its inquiry had suggested that making little use of renewable heat will "overburden" the electricity sector.

Scottish and Southern Energy had told the inquiry that increasing the use of renewable heat would reduce "significantly" the amount of renewable electricity needed to meet the 15% target, while EDF Energy had said to meet future requirements for carbon emission cuts, renewable heat would be necessary.

"It would therefore be short-sighted to ignore renewable heat," the Lords stated.

The Lords committee backed the idea of a feed-in tariff mechanism to support renewable heat, as is now being developed by the government, to be called the Renewable Heat Incentive.

Efficiency

Elsewhere in the Lords report out today, the peers highlighted the need for more action on energy efficiency to help the UK meet its 15% renewable energy target.

While energy efficiency is not technically renewable energy, using less energy overall makes the percentage target for renewable energy generation easier to achieve.

Lord Freeman said: "Energy efficiency and energy saving must be the starting points for meeting the target and policies to encourage reductions in energy use will need to be introduced as part of a comprehensive package of measures aimed at meeting the target."