The Department for Energy and Climate Change (DECC) yesterday [19 Feb] announced that it will not be consulting on action to address Feed In Tariff (FIT) degression for small scale AD, despite Energy Minister Greg Barker saying that it will in a letter to the industry last November.
The news goes against previous statements from the department, including a letter sent to the Anaerobic Digestion and Biogas Association (ADBA) from minister Greg Barker stating that he wanted to ensure that the small-scale AD sector is not unfairly disadvantaged, and that he had asked officials to consult on a tariff review in January.
ADBA, the REA have been pushing hard for a tariff review because they say FIT degression has caused unintended consequences for small mid scale biogas projects, including on farm plants.
Charlotte Morton, Chief Executive, ADBA, said: “It is deeply disappointing that DECC have not been able to follow through on their commitment to ‘consult on measures, including a tariff review, in January ’, and this decision appears contrary to the government’s stated support for small scale AD on farms in particular.
Charlotte Morton, ADBA – “The window to save small AD is getting smaller but is not yet closed… If ministers are serious about keeping small scale AD alive… they will recognise that a stable FIT regime is central to the industry’s growth”
“Smaller scale AD has a range of environmental benefits on top of generating electricity, including encouraging better manure management on farms and reducing the use of artificial fertilisers. A range of UK businesses are also in the process of developing technology and expertise, which will be lost without the early-stage support, which the current FIT level provides.
“The highest tariff degressions were designed to deal with ‘runaway’ deployment, but are hitting smaller scale AD despite just five sub 250kW plants coming online in 2013. This clearly goes against the spirit and intention of the policy, which will be hard to swallow for farmers, developers and their employees.
“The window to save small AD is getting smaller but is not yet closed, as there are a number of plants already in construction. We welcome DECC’s commitment to continue to work to support the sector. If ministers are serious about keeping small scale AD alive, realising sustainable rural growth and delivering the recommendations of the Ecosystem Markets Task Force and the Agri-Tech Strategy, they will recognise that a stable FIT regime is central to the industry’s growth.”
REA Head of Policy Paul Thompson said: “This is a bitter disappointment. We have worked hard with industry colleagues and DECC officials on proposals to fix the FIT for small and mid-scale AD, so it is extremely frustrating that this has not been done. The Government has kicked this issue into the long grass, leaving several projects and companies in the sector at extreme risk.
“Small scale AD will be hit the hardest. Much of this takes place on farms, turning farm wastes and residues into self-supplied green energy and fertiliser, strengthening rural businesses, creating jobs and reducing emissions. We will continue to state the case to Government for AD at all scales and work to secure a viable solution as soon as possible.”