Waste management firm Veolia has warned that the UK appears to be entering another “Dark Age” of returning to fossil fuel reliance, after Gvoernment last week moved to rein in the spiraling costs of renewable power subsidies.
According to Government the subsidies threatened to push up household bills. As a result it launched a consultation on the removal of pre-accreditation from the Feed-in Tariff (FIT).
Addressing the consultation, the Department of Energy & Climate Change (DECC) explained that it was seeking to take:
“Action to limit the risk to bill payers of a deployment surge under the Feed-in Tariff through the removal of pre-accreditation. We are seeking a broad range of input from industry and from consumers. DECC will carry out a full review of the Feed-in Tariff scheme in 2015 and will consult on a full package of cost control measures in due course.”
The DECC consultation document itself outlines the likely impact of such a decision:
“By removing the possibility for projects to pre-accredit, there is less certainty on offer to developers. When they begin to develop a project, they will not be certain as to what tariff they will receive, as there may be tariff degressions between then and the point of accreditation.”
DECC – “By removing the possibility for projects to pre-accredit, there is less certainty on offer to developers. When they begin to develop a project, they will not be certain as to what tariff they will receive, as there may be tariff degressions between then and the point of accreditation”
The plans include closing support for small-scale solar projects, changing the way renewable projects qualify for payments and modifying subsidies for biomass plants.
The proposals come just a month after the government said it would scrap new subsidies for onshore wind farms from April next year.
Richard Kirkman, technical director, Veolia UK and Ireland said: “This is a significant U-Turn from the UK Government highlighting its effective withdrawal from the renewable energy sector ahead of what is set to be the most important climate change discussions of our time at COP21.
“The Government has stripped away without warning incentives for projects on which many companies have made major investment decisions in renewable technologies.
“As a result the Government is not creating a secure climate for business investment in the expanding green economy.
“Only last week the National Grid highlighted the UK was set for brownouts this winter, so we cannot understand why incentives for technologies that will keep the lights on in the UK are being removed.
“We appear to be entering another Dark Age where we will return to total fossil fuel reliance, power cuts, low confidence in UK investment, opening the door for fracking activities to maintain energy security.”
The Anaerobic Digestion and Bioresources Association (ADBA) Chief Executive, Charlotte Morton, commented: “FIT pre accreditation is vital for the ongoing success of the anaerobic digestion sector. Even smaller AD projects are relatively complex, and take over a year to develop – pre accreditation helps to make the development risk acceptable to funders.
“Tariffs for AD are already being reduced, and deployment is falling as a result – so this change is unnecessary from a cost control perspective. The industry’s long development times mean these changes would move the goalposts after the game has kicked off for projects in progress, which will have a severe impact on investor confidence.
“With support, AD can deliver cost effective greenhouse gas savings – potentially as high as 4% across the economy as a whole – and grow a UK supply chain which helps deliver economic productivity and exports. These proposals put that potential at risk, preventing the development of the very technologies that will lower consumer bills in the long term.
“How will the government be able to maintain rhetoric on meaningful climate change commitments at December’s Paris conference, while hitting our green economy at home?”