Greater adoption of distributed and decentralised power could provide a multi-billion-pound boost to key economic sectors, power firm Centrica has said. The firm has this week published a new report, entitled ‘Distributed Energy: Powering Britain’s Economic Future’, which suggests that deploying greater on-site generation such as solar could provide benefits long beyond merely saving on energy costs. If sectors such as heavy industry, healthcare and hospitality adopted more decentralised power the benefits would be felt across the economy. Analysis included within the report claims that if just half of those three sectors – which up roughly one-third of total employment in the UK – could save nearly £900 million each year in their energy costs. This would have ricochet effect, allowing more than 260,000 jobs to be supported and helping boost productivity by 1.5%. Costs would chiefly be driven down by bringing energy generation closer to the point of consumption. Centrica said this would mainly centre around on-site generation through technologies like solar PV and combined heat and power, however the advent of battery storage had allowed new revenue streams to bolster business models.
Solar Power Portal 24th Nov 2017 read more »
Chancellor Philip Hammond was today expected to confirm the future of the Levy Control Framework, but instead documents published by HM Treasury confirmed that measures would be taken to protect consumers from the cost of supporting low carbon generation. It has therefore come to the decision to enact new controls which will inhibit new low carbon electricity levies until “the burden of such costs is falling”. Based on current forecasts, HMT expects this to be 2025. The decision has been widely condemned from industry stakeholders and opposition MPs alike. Alan Whitehead, shadow energy minister, labelled the decision a “catastrophic shut down for most of Britain’s renewables industry”. His concern was echoed by James Court, head of policy and external affairs at the Renewable Energy Association, who said the government seemed to be “turning their back” on renewables. “This could see a hiatus in much needed infrastructure development. Considering this is coming only a couple of months after the much vaunted Clean Growth Plan, it’s hugely disappointing.
Solar Power Portal 22nd Nov 2017 read more »
Yesterday afternoon chancellor Philip Hammond took to the despatch box to deliver the Autumn Budget. Amidst headline promises of stamp duty relief and fresh funding for driverless, electric vehicles, there were no major pledges relating to the energy market. Hammond neglected to mention it during his speech but perhaps the most significant policy decision taken with regards the energy sector is the government’s decision not to provide any further levies for low carbon electricity until 2025. This decision, the government said, has been reached to protect consumers from any further burden caused by levies and their impact on energy bills. This comes by means of a replacement for the Levy Control Framework – the mechanism used to monitor and control levies passed onto consumer bills – which was due to be replaced. Meanwhile the Office for Budget Responsibility (OBR) once again revised down its forecast for environmental levies. It now expects spending under the LCF to fall by a further £0.2 billion to £0.3 billion a year out to 2020/21 and by £0.5 billion a year in 2021/22, courtesy of reduced spending under the Renewables Obligation and Contracts for Difference schemes. While the RO has of course been closed, the OBR’s reduction in CfD costs stems from a higher projection for wholesale energy prices, in turn reducing total subsidy costs paid to contracted generators, and cheaper than expected contracts within the most recent round. Within the document published yesterday the government outlined a series of assumptions, including the forecasted deployments of different technologies under the various subsidy programmes such as the RO, CfDs and the feed-in tariff. These forecasts revealed that the government expects roughly 200MW of small-scale, FiT-accredited solar to be installed in this financial year, followed by a further 240MW in the forthcoming year. These would be the final periods of solar deployment under the FiT with the scheme set to close to new applicants on 1 April 2019. However to reach even that level of deployment would require an uptick in the current trends. Solar has under the current tariffs installed around 40MW of solar per quarter. It would also leave a significant amount of unused capacity within the feed-in tariff deployment caps, currently totalling more than 200MW. There is however still no sign of BEIS’ review of the feed-in tariff scheme. It was scheduled to conduct bi-annual reviews of the scheme but has yet to do so. The department is committed to conducting the review before the end of this year so should enact it before parliament rises for recess on 21 December. The review could form part of the government’s wider proposals for future support frameworks for solar PV in the UK which was promised within last month’s Clean Growth Strategy. But while the government is opposed to enacting new levies for low carbon power generation, it has opened the door for support frameworks which do not add to subsidy costs on consumer bills. As well as the Budget, yesterday also saw the release of the Public Accounts Committee’s damning indictment of the government’s handling of the Hinkley Point C contract. Within it, the committee has called on BEIS to release a ‘Plan B’ should the project fall further behind schedule and for that plan to be published before the end of this year.
Solar Power Portal 23rd Nov 2017 read more »