Trade associations slam Government attack on renewables

by Search Gate staff. Published Thu 01 Oct 2015 12:22, Last updated: 2015-10-01
DECC ignores "meaningful engagement" with renewables sector
DECC ignores

The seven trade associations that represent the UK’s renewable energy industry have published a joint statement criticising the Government’s action of withdrawing subsidy support.

The groups say the policy of Energy Ministers has jeopardised hundreds of green energy projects resulting in millions of pounds of investment and thousands of jobs being put at risk.

The 374-word statement also reveals that the Department of Energy and Climate Change has shunned “meaningful engagement” with the industry to discuss the “deeply flawed” closure of Feed-in Tariff preliminary accreditation.

The statement reads: “On behalf of the renewable energy sector, and many thousands of businesses, community groups and investors, our organisations have come together to call on the Department of Energy and Climate Change to review urgently its decision to remove preliminary accreditation from the Feed-in Tariff.

“As of today, 1st October, developers are no longer able to register for financial support under the FiT at a specific level before they start generating, increasing uncertainty over their viability. This change has removed access to the FiT from individuals, farmers, businesses, investors and communities looking to generate their own power. As a result, hundreds of projects, millions of pounds of investment and many thousands of jobs have been put at risk. It also has the reverse impact of what the Government seems to intend, by pushing up costs.

“This change is bad for business and bad for energy security. Renewable energy is not a ‘nice to have’: it generates more electricity than coal and provides employment in manufacturing and in the rural economy.

“We believe the consultation process on the removal of pre-accreditation was deeply flawed. No impact assessment was provided by DECC and insufficient time was allowed for a proper consideration of the proposal. The unexpected move was announced on 22nd July and confirmed on 9th September.

“Since the Government’s decision to remove pre-accreditation, DECC has launched a root and branch Feed-in Tariff review which envisages fundamental changes to tariffs and caps on levels of deployment. The Government has indicated that pre-accreditation could be reintroduced as part of future proposals. Since it is unclear how the scheme can operate without a pre-accreditation system, we would like to see a clear statement from Government about the use of new pre-accreditation controls as part of any revised scheme.

“It is unfortunate that we have so far been unable to establish meaningful engagement with DECC on this matter. We would therefore urge DECC to expedite meaningful engagement between ourselves, the Secretary of State and her advisors in the coming weeks. We desire to work in a spirit of co-operation with Government and find a route forwards that allows many more people to benefit from installing renewables on their rooftops, farms or businesses, while helping to manage costs for all consumers.”

The statement was published as fresh analysis found Government solar plans risk leaving industry with just £7million of support over 3 years.

The study by the Solar Trade Association uncovered that the Government is planning on spending even less on solar over the next three years than many commentators originally thought.

In the Feed-in Tariff Review (FiT) consultation published by the Department of Energy and Climate Change three weeks ago, draconian cuts to the tariff for domestic solar of up to 87% are proposed, together with stringent maximum deployment caps.

The STA has conducted a detailed analysis of the Government proposals which shows they would result in a maximum of just £7million of support on new solar deployment under the Feed-in Tariff scheme from next year, over the next 3 years (2017-2018).

Spending will fall from a current run rate of less than £70million per year to £2million per year, or a 98% cut in the total budget.

The solar industry has had all other forms of support removed over the summer, and there is no clarity on future auction rounds for large-scale solar under the Contracts for Difference system.

As a comparison, £7million is less than what Buckinghamshire County Council spends on potholes in a single year.

This is out of a total low carbon energy budget called the ‘Levy Control Framework’ projected to be £7.6billion by 2020.

To put the £7million budget into context, that means that over the next three years 0.04% of the Levy Control Framework budget is being spent on new solar projects.

Paul Barwell, CEO of the Solar Trade Association, commented: “Allocating £7million of support for solar power – the world's fastest growing clean energy solution – is absurd. This does not constitute a serious energy policy.”

"Solar can transform choice and competition in electricity markets, so the government’s short-term thinking on bills risks condemning hardworking families to a future of higher energy costs.”

“This 98% cut in support is extreme and will decimate the nation’s most popular source of energy, and puts at risk over 20,000 solar jobs. The UK will be left behind if we turn our back on a global solar revolution.”

“We have a plan to maintain a robust and growing solar industry and are keen to work with Government to find an effective solar policy that also delivers value for money. It is essential the Government rethinks its proposals – jobs and businesses are at risk.”

“Given how close solar is to being subsidy-free – which these cuts will delay – giving this vital technology one last push is clearly in the interest of consumers. Currently Government is set to trip its solar revolution up at the last hurdle, which makes no sense at all.”

Momentum is building behind efforts to urge the Government to rethink its plans for the Feed-in Tariff and solar energy. The CBI said last week that the "roll-back of renewables policies” was sending a worrying signal to businesses. The statutory Committee on Climate Change said that funding should not be withdrawn “too early”. Energy UK, the body that represents energy utilities, as well as other big business names such as DuPont have also called for the Government to “urgently reconsider” the proposals. The CEO of Shell recently said solar “will be the dominant backbone of our energy system”

Today’s statement was issued by the following trade associations:

* Anaerobic Digestion and Bioresources Association

* Community Energy England

* Regen SW

* Renewable Energy Association

* RenewableUK

* Scottish Renewables

* Solar Trade Association.

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