BERNIE BULKIN: 15% - AND BEYOND FITS: RIDING THE SOLARCOASTER RENEWABLES' MEDIA DRUBBING
THE HARTNELL INTERVIEW
Greg Barker BIG CHALLENGES: BIG VISION
INSIDE: YOUR DECISION-MAKERS' GUIDE TO EFW NETWORKS: PROJECT TRANSMIT FOOD AND FUEL: AD AND BIOFUELS
contents winter 2012 edition
It was Greg Barker’s turn to be interviewed for this edition of REA News and it proved very timely too. Greg was generous with his time and his responses will no doubt be music to the ears of some sectors, notably Deep Geothermal. The Minister has taken a lot of grief over the solar FITs debacle, but he is an ally and the industry needs to get into a position where it is working on a game-changing agenda with DECC rather than battling for recognition. With costs of large-scale solar falling beneath offshore wind during this Parliament, the renewables roadmap will need revisiting. You can read about how REA responded to the FITs crisis and our on-going concerns, in this edition of REA News. We value good relations with Ministers, but we’re never afraid to make our members’ needs known, loud and clear, even to No10. We had great support for our sign-on letter on the FITs crisis to the Prime Minister and Deputy PM, as you can see from the photo where I was joined by cross-party MPs handing it in at Downing Street. We value the important role of opposition in holding Government to account and new Shadow Energy Secretary Caroline Flint has already made an impact. If you haven’t yet heard me talk about the ‘squeezed middle’ you soon will, as you read on. We admire Greg Barker’s vision but we are concerned that in practice, DECC policy is increasingly leaving mid-sized technologies and investors stranded. Bernie Bulkin’s article, while hugely reassuring in his vigorous pursuit of the 15% target, underlines DECC’s focus on big solutions. Clearly we need to work harder to explain to DECC that large numbers of small and medium schemes can also add up to big investment. Polarised debates rarely help, so it’s good to read in REA News about opportunities to deliver food and fuel together. Intelligent and pragmatic solutions in the face of complex challenges show the way forward. Another often misunderstood area is Energy from Waste. I’m particularly pleased to have three technologies, which can sometimes be more at pains to point out their differences from one other than their wider benefits to society, together on one page in the enclosed pamphlet. Finally, we’re looking forward to this year’s British Renewable Energy Awards. Nominations are open, and we've got several exciting new awards categories. Gaynor Hartnell
4 News Round-up 8 Policy Overview 10 Biofuels Investor Confidence 11 REPAP Next Steps 11 On-site Renewables 13 The Hartnell Interview: Greg Barker 16 Renewables' Media Drubbing 17 REA's 'Back Biomass' Campaign 18 RO Banding Review 19 UK's First Geothermal Power Plant 20 FITs: Riding the Solarcoaster 22 Food and Fuel 25 Bernie Bulkin: 15% and beyond 26 Project TransmiT 28 REA Events Overview 30 RHI Goes Live
CREDITS REA news is edited by Leonie Greene assisted by James Beard and with contributions from REA staff and invited guest writers. Thanks to Greenpeace UK, DECC, REA staff, REA members and others for photos, as credited. For this edition our sincere thanks to Greg Barker, Bernie Bulkin, Allister Prow, David Knibbs, Duncan Clark, Magnus Boyd and Dr Michael Marsden. Feedback on REA News is welcome firstname.lastname@example.org
CAPITAL TOwER, 91 wATERLOO ROAD, LONDON SE1 8RT T: (020) 7925 3570 F: (020) 7925 2715 www.r-e-a.net
The cover photo features Energy & Climate Change Minister Greg Barker and REA Chief Executive Gaynor Hartnell on the Common’s Terrace. Contents page photo shows Alan Whitehead MP, Howard Johns, Rt Hon Caroline Flint MP, Gaynor Hartnell, Jeremy Leggett, Caroline Lucas MP and Andrew Pendleton. images: DECC, Gavin Rodgers
Published by the Environment Media Group, Elizabeth House, 39 York Road, London SE1 7NQ, Designed by Margarita Lorenzo Sales: Rob Mowat, Commercial Director, t: 020 7633 4514, e: email@example.com, www.environmentmedia.co.uk Disclaimer: This magazine has been compiled in good faith and the Publisher has endeavoured to ensure accuracy throughout. Neither the Renewable Energy Association nor the Environment Media Group can accept responsiblity for any inaccuracies or the products or services advertised.
reA Press Officer JAmes BeArd gives A rOUnd-UP Of the keY news stOries James Beard email: firstname.lastname@example.org, twitter: reA_news
dUrBAn climAte tAlks set PAth tO new glOBAl emissiOns treAtY
secretary of state chris huhne at the durban climate change conference
For the first time in the UNFCCC’s 20 year history, every country has agreed to replace the Kyoto Protocol with a global, legally binding climate treaty, which will impose limits on all countries – unlike Kyoto, from which developing countries were exempt. The treaty will be finalised by 2015 and enter into force in 2020. Chris Huhne said to Parliament: “Durban alone will not limit global warming to 2 degrees above pre-industrial levels. But we have taken a clear and vital step toward our goal.” The 2009 Copenhagen COP flop and the fairly low key conference in Cancun in 2010 had lowered expectations of the climate talks, but hopefully the better-than-expected progress made in Durban, where Chris Huhne and Greg Barker were representing the UK, will restore confidence in the UNFCCC process. Progress was also made on the Green Climate Fund, although some environmental groups decried the lack of overall substantial progress.
Understanding energy from waste: Your free guide Included with your copy of REA News is our Energy from Waste Guide for Decision Makers. Energy from waste (EfW, also known as waste-to-energy) is a complex but vital sector of the UK renewables industry, encompassing combustion, gasification and pyrolysis, and anaerobic digestion/biogas. In recognition of the fact that many stakeholders and decision makers have unanswered questions about EfW, REA produced this very user-friendly, nontechnical guide to give a concise overview. We hope it answers your questions!
eU energy roadmap 2050 calls for binding 2030 renewables targets
reA enters the twitterverse
“You heard it here first” – twitter is the place to go for breaking news and comment
Alongside our website relaunch, we have also taken some tentative steps into the world of social media. Follow us on Twitter @REA_News where we regularly tweet updates and announcements, and head on over to our Facebook page at on.fb.me/xJoNX2 to give it a ‘like’ and browse through our info and photos.
eU energy commissioner günther Oettinger is giving mixed messages
Poll reveals strong public support for renewables A YouGov poll, commissioned by The Sunday Times, has shown huge public support for renewable energy. 74% and 56% of respondents think the UK ought to be using more solar and wind respectively. In each instance, the number of supportive Conservative voters was below these averages while the number of supportive Labour and Liberal Democrat voters was above the averages. Only around a third of respondents want more nuclear, while over a quarter are actively opposed. Oil and coal power stations receive little support. 67% of respondents say solar and 47% say wind energy are realistic ways of fighting climate change. The poll further reveals the extent to which the negative noise around renewables generated by certain sectors of the right-wing press is really out of tune with real public opinion.
images: DECC, Friends of the Earth
The EU 2050 Energy Roadmap was launched in December with a call from Energy Commissioner Günther Oettinger for binding 2030 renewable energy targets to be in place by 2014. The Roadmap explores 2050 scenarios ranging from 55% – 75% penetration of renewables into the total EU energy supply, concluding that a high renewables scenario would be no more expensive than a scenario highly dependent on CCS or nuclear. However, The Guardian warned that there is likely to be much wrangling between the EU Member States, not only over the distribution of the new 2030 targets, but also over potential reviews of the existing 2020 targets. Confusingly, Günther Oettinger disagrees with Climate Commissioner Connie Hedegaard on the 2020 targets, which he thinks should be less ambitious. Dowload the Roadmap at bit.ly/zD6fHN.
winter 2012 REA NEWs
A record-breaking year for renewables Renewable energy generation in the UK hit a high in the second quarter of 2011 with an average 9.6% contribution to the UK’s electricity supply according to figures released by DECC. This is a 50% increase from the same period in 2010. Notably wind energy production was up 120% and hydroelectricity was up 75%. Later in the year, the storms of 28th December saw wind farms generate a record penetration of 12.2% of UK electricity supply. Meanwhile, Scotland enjoyed a record-breaking £750 million investment in renewables in the year to October 2011.
Committee on Climate Change calls for expansion of bioenergy The Committee on Climate Change published in December its Bioenergy Review, calling for 10% of energy demand to be met from biomass in 2050. The REA welcomed the report, but criticised its pessimism concerning bioenergy availability and its lack of attention to CHP and district heating. Dowload the report at bit.ly/wfK7Eq.
wwF: renewables could provide 60% oF uK electricity by 2030
DECC lAunChEs CArbon PlAn AnD 2050 PAthwAys CAlCulAtor On 1st December DECC published the Carbon Plan, a strategy for reducing GHG emissions through to 2020. REA Chief Executive, Gaynor Hartnell, commenting on the Carbon Plan said: “It sets out to be agnostic regarding the future share between renewables, nuclear and carbon capture and storage in our energy mix, with Government committed to doing whatever turns out to be the cheapest. Renewables have three trump cards however – the fuel will never run out, there are no waste products to store, and they deliver energy independence.” DECC’s 2050 Pathways Calculator, developed by Professor David MacKay, was launched alongside the report. In late December, both The Guardian and The Telegraph published numbers crunched using the Calculator which show that greening the energy sector costs no more, and could be cheaper, than business as usual, even without accounting for the economic impacts of climate change. Dowload the Carbon plan at bit.ly/AagEDj and try out the Pathways Calculator at bit.ly/zGM60S.
Windsor Castle goes renewable In September two large hydroelectric Archimedes turbines arrived at Windsor Castle for installation at Romney Weir on the River Thames. The installation was completed just before Christmas. The turbines will provide for approximately half of the Castle’s energy needs This project demonstrates the monarchy’s commitment to low carbon growth – despite Prince Philip’s disparaging comments on wind turbines in November. royal renewables
winter 2012 REA NEWs
£8 billion BIs growth plan to create opportunities for marine renewables In September, Business Minister Mark Prisk launched the Marine Industry Growth Strategy (MIGS) aimed at creating the opportunity for potentially £8 billion in growth for the British marine and maritime industry by 2020. The strategy is the first ever integrated UK strategy for the marine industries and establishes a foundation for ambitious but sustainable long-term growth. “Expanding the domestic offshore renewable energy industry” is explicitly recognised as an area for growth within the strategy. Mark Prisk added, “By harnessing the potential of the sector, and the research potential of our universities, we can build our strengths and capabilities to make sure that Britain’s marine sector has a bright and successful future.”
images: Greenpeace UK, rachel in wonderland
it has been a good year for wind power
In October, the World Wildlife Fund (WWF) published a report entitled “Positive Energy: how renewable electricity can transform the UK by 2030.” The report found that over 60% of the UK's electricity needs could be met by renewable sources by 2030 if the country invests in demand reduction and improved grid connections with Europe. The report was widely read and well received. Caroline Lucas described the report as “compelling” and “a wake-up call for the Government to stop the antigreen forces in the Coalition from scaling back ambition on the UK’s climate and renewables targets – and undermining investor confidence in clean industries.” Dowload the report at bit.ly/wH19x6.
UK on track for 2012 renewables targets Government has submitted its first mandated progress report to the European Commission on its progress towards the 2020 renewable energy targets. The report covers the period 2008-2010 and shows that the UK is on track to reach its interim 2011-2012 targets. Highlights from the report include: a 27% increase in renewable energy consumption, a 46% increase in wind generation, and a threefold increase in use of biofuels. However, the good news comes with a significant caveat, as the report acknowledges that “the rate of deployment will need to be further increased to ensure we the meet the interim targets towards the end of the decade.”
images: second Nature Partnership, Greenpeace UK
Huhne blasts climate sceptic “think tank” Chris Huhne in November blasted into the often circular climate sceptic debate with a damning critique of Lords Lawson and Turnbull and their think tank Global Warming Policy Foundation. The GWPF, gives itself a name suggesting support for action on climate change and renewables, while in practice is seen by some as attempting to stifle such action. In response to a GWPF report, Huhne wrote, “I believe that you have been misinformed and that your conclusions are poorly supported.” He added, “It would be perverse to ignore this well attested and thoroughly reviewed body of evidence,” before concluding, “The scientific case for action is robust. We would be failing in our duties to pretend otherwise.”
reA’s Leonie Greene had plenty to tell Al Gore about the UK industry’s challenges
reA explains UK renewables challenges to Al Gore REA attended an inspiring private event with Al Gore at the Royal Institution in November. The former US Vice President shared his fascinating personal insights on mobilising the solutions to climate change, and the huge barriers that advocates face. Mr Gore was in the UK promoting his new Climate Reality project, which is helping to educate the public on the most up-to-date facts about climate change and its real world impacts. REA was pleased to have the opportunity to explain to Mr Gore the challenges faced by renewables in the UK, including their treatment in parts of the press. This solutions-oriented event was organised by Charles Perry of Second Nature.
Lively debate over Cameron’s claim to lead “greenest government ever“ Jonathon Porritt and Tony Juniper are among those lining up to accuse David Cameron of failing to live up to his promise to lead the “greenest government ever”, and of cynically using his 2010 photoshoot with huskies in Norway as vote-winning greenwash. In September the Green Alliance report Climate Check concluded that while some progress had been made, it was outweighed by delayed and poorly designed policies. Some commentators have blamed George Osborne, whose complaints about “burdensome” green policies in his Autumn
IEA World Energy Outlook calls for more renewables
we must decarbonise our energy supply by 2017 if we are to avoid dangerous climate change
The International Energy Agency’s annual World Energy Outlook was published in November. The headline is that globally we have until 2017 to rescue the 2 degrees target. If significant progress is not made decarbonising the world’s energy systems before then, so much carbon will be ‘locked in’ to existing fossil fuel plant as to render impossible the achievement of less than 2 degrees warming. Post-Fukushima, the report states that natural gas and renewables will “become increasingly important”.
Statement speech sparked furious response from green critics. Osborne unequivocally stated, “We’re not going to save the planet by putting our country out of business.” Most recently, Zac Goldsmith castigated green critics for failing to acknowledge the progress the Government is making, such as launching the world’s first Renewable Heat Incentive and legislating the world’s first Green Investment Bank. Zac argued that green groups risk alienating their Westminster allies by not acknowledging the successes they have have achieved, and regressing the overall agenda.
Lord Turner steps down from CCC The Committee on Climate Change will soon appoint its new Chair, following the announcement in December that Lord Adair Turner, who has chaired the Committee since its inception in 2008, will be stepping down. The CCC was set up following the 2008 Climate Change Act and has sustained a high policy profile throughout its short life so far A BusinessGreen poll puts Lord Stern, author of the flagship report into the economics of climate change, as the people’s favourite to succeed Lord Turner. REA NEWs winter 2012 7
Policy Overview, winter 2012 The ‘greenest Government ever’ claims are being vigorously contested. Paul Thompson takes an objective look at the evidence so far for renewables.
solar roof installation. rea has consistently urged Government to take a more ambitious approach to this popular technology
s with the previous Government, it seems that the slowest department to grasp the benefits of renewables will be the Treasury. There was just one green policy mention in the Autumn Statement (and it wasn’t renewables). On the other hand, George Osborne did propose new 80mph speed limits, possible airport expansions, and tax breaks for intensive energy users. Many organisations declared their verdicts on the Government’s green credentials, such as declaring that it was ‘on a path to becoming the most environmentally destructive government to hold power in this country since the modern environmental movement was born’. While the debate rages, energy prices are finally falling after the UK’s second mildest year on record. That’s probably not a great indicator for climate change, and it’s a mixed blessing for renewables. On the one hand it makes renewables relatively that little bit more expensive. On the other it lessens pressure on bills and politicians, which has resulted in unhelpful knee-jerk actions in some areas. Which brings us neatly on to Feed-In Tariffs. LOcaL POwer My last overview of Feed-In Tariffs 6 months ago painted a messy enough picture, but
things have deteriorated dramatically since then. REA had advised cutting the Tariffs in an orderly manner over six months ago. Instead, as deployment surged, the sector was shocked by Government cutting solar tariffs in half in just six weeks. As we go to print, the Government has just suffered its second defeat in the Courts on this consultation. It is likely that the worst of the short-term uncertainty is over, but concerns over the available budget will need to be dealt with if the industry is to be able to plan for the longer term. The difficulty of the situation in which we found ourselves is set out elsewhere in REA News. Elsewhere, the Green Deal Consultation closed in January. The policy is intended to make it easier to finance carbon saving measures (predominantly energy efficiency) by enabling householders to borrow money to fund projects and pay them back through expected savings on their energy bills. As proposed, there is very little scope for the
inclusion of renewables and integrating these policies with the Feed-in Tariffs and Renewable Heat Incentive – a huge missed opportunity. The policy is also extremely complicated, and we have serious fears about whether consumers will be able to understand it – with a risk of low uptake and possible mis-selling. renewabLe heat The RHI finally went live in November. The scheme supports ground source heat pumps, biomass, biogas, solar thermal and biomethane injection to the gas grid. A number of technologies and scales are not included – and the scheme is currently limited to the non-domestic sector. A consultation on a ‘phase 2’ is due in the coming months. REA made a major contribution to the first phase – from detailed cost modelling to winning the big political arguments. We also spotted a number of mistakes in the regulations, fortunately just in
“Renewable energy is not just helping us increase our energy security and reduce our emissions; it is supporting jobs and growth across the country, and giving traditional industrial heartlands the opportunity to thrive again.” chris huhne
winter 2012 REA NEWs
rea_PG08-09_policy overview.indd 2
time for them to be corrected. We’re geared up for more of the same on phase 2 as there’s much more to do if the policy is to deliver the renewables deployment and carbon savings needed in the heating sector.
images: Clear Solar Ltd, Greenpeace UK
Central Power REA is still awaiting details of how the Contract-for-Difference FIT will work under EMR. This matters, not least as we are working with DECC to potentially put down a marker in the forthcoming Energy Bill for addressing what we’re topically calling the ‘squeezed middle’. We don’t mean ‘hard pressed families’, rather the wide range of important mid-sized investors and technologies now falling between a shrinking FIT and a hugely complex EMR. As often happens, there is the tendency for government to think that energy is either huge or tiny, with nothing in between. REA had to mobilise a strong show of support to expedite the RO Banding Review Consultation. The delay in publication had put over £6 billion of investment at risk. We wrote a private letter to the Prime Minister, widely copied across Government, and attracted major signatories to our letter from CEOs of the utilities and key companies, to prominent parliamentarians and environmentalists. The pressure seemed to work and the proposals were broadly reasonable – see elsewhere in REA News. However, an overarching concern is that the proposed rates of degression in RO support for these technologies are unrealistic. Ofgem’s Project TransmiT is nearing its completion and members can read about it in relatively accessible language in REA News. Network charging issues can be prohibitively complex, but we’re here to help. This matters to all renewable power generators so get involved – members can do so through our regulator Generator Group meetings and mail-outs. The threat of National Grid levying transmission charges on those connected to the distribution network continues to worry REA. Project TransmiT will not deal with this issue, as we had hoped. We will alert members when this important issue resurfaces. renewable transPort Biofuels can sometimes feel like the most thankless area where members are damned if they don’t deliver an environmentally sound product and equally damned if they do. Interestingly the Guardian’s Environment Editor Damian Carrington wrote a more balanced piece than we are used to seeing, prompted by the first ever global fall in biofuels production. The UK implemented the binding sustainability standards in the Renewable Energy and Fuel Quality Directives at the end
wind farm under construction. Concern has grown that parts of government still see the green agenda in opposition to growth, despite abundant evidence to the contrary
of December. At present we only have targets up to 2014, with the Government dragging its feet on setting targets beyond that. Without clearer policy signals, investment in UK production will continue to stagnate, despite consistent evidence that biofuels made from UK-produced feedstock perform strongly on both GHG savings and environmental sustainability. strategiC and Cross-Cutting PoliCy Various big picture strategic documents are due this year, including in bioenergy and heat. It’s clearly good to have an overarching strategy, although the crucial thing is whether this is followed by a series of individual policies that will put this into practice. The book cases are full of well-intentioned strategies whose only impact on the environment is the energy expended producing them. One set of changes that will make a difference is planning reform. This cuts across the renewables sector. At the larger scale, the Infrastructure Planning Commission will be abolished and its powers returned to the Secretary of State. At the smaller scale, we are still awaiting permitted development rights to be extended to non-domestic premises. Returning to the often-neglected mid-scale,
the National Planning Policy Framework proposes further shake-ups – it’s also proving controversial, with a wide range of concerns that it skews the balance too far in favour of development. The problem with planning reform is not that the overall effect will be good or bad. The problem is that it’s almost impossible to tell, and it may take many years for the new system to settle down. In the meantime, there is the risk of confusion over which documents take priority – with the accompanying delays, legal challenges and costs that would result. so How is tHe government doing? Well, both the optimists and pessimists can find plenty of evidence to support their views. The truth is that far too many pieces are up in the air at the moment and we’ll have to wait and see where they land. One thing is for certain. Decisions taken or ducked in 2012 will set the course for many years to come.
Paul thompson, Head of Policy email@example.com
REA NEWS winter 2012
rea_PG08-09_policy overview.indd 3
Biofuels: Investor confidence key to meeting 10% renewable transport target
he Government took a great step forward in December by introducing the Renewable Transport Fuels Obligations Order, which sets mandatory carbon saving and sustainability rules for biofuels. Although the UK biofuels industry, which delivers the highest standards for biofuels, has long been urging the Government to implement the transport
UK biofuels may be top sustainability performers but policy fog risks sending the banks elsewhere. Clare Wenner, Head of Renewable Transport, says innovations in biofuel production further strengthen the case for enthusiastic Government support. elements of the EU Renewable Energy Directive, the latest RTFO Order falls short of setting a clear pathway to the 10% target. Instead, the Government will put
Case study: ViReol lTd: inVesTmenT in innoVaTion Vireol is in the final stages of raising £200 million to build a large biorefinery in Grimsby, North East Lincolnshire. From the outset, the project has been designed to deliver a sustainable and environmentally friendly business proposition. The refinery will run on feed-grade wheat, which is at present often exported to countries like Spain and Belgium, also dave Knibbs, Chief executive, at Vireol Ltd for use in bioethanol production. It will produce 200 million litres of bioethanol for blending with fossil fuel (with a carbon saving well in excess of 50% compared to petrol) and 175,000 tonnes of high protein animal feed (of which the UK currently has to import 2 million tonnes per year). It will also create 100 full-time jobs (in an economically hard hit area in North Lincolnshire), as well as 750 construction jobs, while also helping the area to realise its ambition of reinventing itself as a renewable energy hub. This project has survived thanks to significant private equity backing from Future Capital Partners. Generally though the industry has struggled to raise debt finance, especially from senior banks. Many of our competitors who were hoping to take advantage of the Renewable Energy Directive – which requires 10% of transport demand to be met from renewable sources – have since folded, unable to keep going even as the economic climate improved. But why? In part this is due to indecisiveness from successive governments about how best to “green” the UK transport sector. This has left policy somewhat underdeveloped compared to other EU member states, and has seen France and Germany take the lead. Banks have understandably gone with the greatest certainty first and mainly invested their green funds in wind power, where investments are underwritten by guaranteed subsidy levels. Investment confidence has been hampered by the lack of a clear signal from Government on the need for home-grown biofuels, and by the Government’s failure to produce a clear strategy for achieving its 2020 renewable transport targets. However, confidence is likely to return as the transport roadmap to 2020 starts to become clear. The Vireol project will reach financial close in the next three to four months, supported by European banks who share a similar vision of sustainable transport fuels for Europe. A more certain and proactive policy framework in Britain that recognises the same vision is vital to ensuring that Britain can achieve its 2020 renewable transport targets.
out another consultation in 2012 on the most appropriate trajectory for renewable transport for the years 2014-2020. As Dave Knibbs explains below, this indecisiveness has sapped investor confidence and left the UK well behind other countries. However, the UK can and must meet its 2020 target. Firstly, the Climate Change Committee’s recent Bioenergy Review states clearly that there will be a need for sustainable biofuels in all modes of transport for at least 20 years, and that electric vehicles will not make a significant contribution to sustainable transport until the 2030s. Biofuels will be the only substitute for fossil fuels, which, apart from their environmental impacts, will become ever more expensive. Secondly, the UK can produce significantly more biofuel, particularly bioethanol, from domestic feedstocks. As Dr Michael Marsden points out on page 23, UK biofuel production delivers useful co-products – high protein animal feed ingredients – thereby supplying both food and fuel. While there will always be a need for imports of sustainable biofuels, the Government should do more to promote domestic production and its economic benefits for the UK. Thirdly, the Government should play its part in managing the issue of indirect land use change (ILUC). The European Commission will publish proposals on ILUC later this year. The debate should recognise the value of co-products and produce speedy decisions to allow the biofuels industry to move forward. We urge the Government in the coming year not only to set a trajectory to meeting the 2020 target, but also to indicate that support for sustainable biofuels will continue beyond 2020, so that the UK transport sector can make a significant contribution to the UK economy, fuel security, and the low carbon agenda in the years to come.
Clare wenner, Head of renewable transport firstname.lastname@example.org
wInter 2012 Rea neWs
From REPAP to ‘Keep on Track’ of 15% renewable energy (heat, electricity and transport) by 2020. Under the Renewable Energy Directive, the European Commission required each member state to submit a National Renewable Energy Action Plan he REA can confirm the UK must (NREAP) to set out how the 2020 targets will ramp up its renewable deployment be met. more steeply than almost any other The Commission also funded the panEuropean Member State if it is to hit its target European project REPAP2020 – Renewable Energy Policy Action Paving the Way for 2020 – in order to hear directly from the industry in each member state on their confidence in their Government’s NREAP. The project started in April 2009 with the aim of facilitating the implementation of the Renewable Energy Directive on a national level. The REA was the lead partner for the UK on this important project, and produced a shadow action plan, as well as providing updates on issues and policy changes to the project partners. More information and fascinating reports on each reA is again assessing the Government's renewables member state’s renewables progress for the Commission
senior Policy Analyst Tricia wiley reports on REA’s key role in monitoring UK progress on the EU 2020 renewables targets
policies are available from the project website; www.repap2020.eu. The UK government published its first mandated progress report in December 2011. The good news is that we are on track to achieve the first interim target for 2011/12, but Government recognises that the rate of deployment will need to be further increased to ensure the more challenging interim targets are met towards the end of the decade. The REA has now been invited to participate in a follow-on project that will be kicking off shortly called “Keep on Track”. The project will continue the work started by REPAP2020, providing close-to-market monitoring of the fulfilment of the renewable energy trajectory for each of the 27 EU Member States. The project aims to provide early warnings in case a Member State is lagging behind its trajectory.
tricia wiley, Senior Policy Analyst, reA email@example.com
Frustrations Grow for On-site Renewables senior Policy Analyst Mike Landy summarises a very busy agenda, in which clarity is the key missing ingredient
images: DECC, CCC
ECC’s late recognition of the rapidly accelerating deployment of PV under FITs led to a highly controversial consultation on reducing PV tariffs by over 50%, for fear that runaway demand would deplete the limited FIT budget. Whilst the majority of the industry accepted the need to reduce tariffs in line with falling costs, introducing the new tariffs before the consultation had even closed caused widespread anger, compounded by a proposed new energy efficiency requirement that could greatly increase implementation costs. REA’s detailed modelling work on the additional cost of maintaining support for PV on its glide path to achieving grid parity’ has been sidelined by the legal furore. Hopefully this is only a temporary setback. The Renewable Heat Incentive (RHI) was finally launched in the non-domestic sector
Green Deal concerns. CCC Chief executive David Kennedy warns a market-led approach presents a ‘significant risk’
at the end of November. However, it became evident that DECC is rethinking how to support heat in the domestic sector and we are unlikely to see concrete proposals for some time. Predictably, uptake of the domestic targeted Renewable Heat Premium Payment scheme has been low as the market waits to see what long term support will be available for domestic heat. Frustration within the industry is growing. DECC’s flagship Green Deal policy began to take shape with the launch of the consultation in November. However, the microgeneration industry was again disappointed to find that,
while microgen technologies are included as eligible measures, DECC clearly envisages a limited role for them, with the focus mainly on solid wall insulations and no real join-up with the RHI or FITs. We await a consultation on the 2013 Part L Building Regulations in the hope that these could provide some clear regulatory incentives to complement the financial incentives provided by the RHI and FITs. This has been preceded by a consultation on the Standard Assessment Procedure used to predict energy consumption in dwellings. We start 2012 with less certainty for the sector than in 2011. Perhaps the one bright spot is the clear evidence that industry was able to gear up to deliver high levels of PV deployment when the incentive was present – though REA would never advocate a repeat of the conditions under which this took place!
Mike Landy, Senior Policy Analyst firstname.lastname@example.org
REA nEws winter 2012
rea_PG11_repap_onsite power.indd 1
200 Strand, London, WC2R 1DJ Telephone: +44(0)20 7539 7272 Fax: +44(0)20 7240 6143
Major suppliers of renewable Fuels to European power generators, industrial, commercial and domestic users. Biomass UK provides renewable and necessary material for both direct power generation and co-burning with conventional fuels derived from sustainable production. Fuel types include woodchip, sawdust, wood pellet, PKE, olive cake and other plant derived fuels. Contact: John White, Managing Director Office: +44 (0)20 7539 7272 â€˘ Fax: +44 (0)20 7240 6143 Mobile: +44 (0)7831 669660 â€˘ Direct Fax: +44 (0) 1653 628003
The Hartnell Interview:
Energy & Climate Change Minister Greg Barker answers REA’s most pressing questions on renewable heat, marine, solar, deep geothermal, AD – and listens to our worries about the ‘squeezed middle’. Hartnell: Great to see the RHI going live. What we really want to know is what would success look like for you? Barker: I want to see the UK transform its use of heat away from over-dependence on fossil fuels, which are increasingly imported, to using innovative technology. To meet our carbon targets, 12% of our heating needs to come from renewables by 2020 – this is a massive opportunity. The first job is to ensure that we employ existing technology at scale, but we also need to return to the innovation agenda to exploit the potential for the RHI to spur domestic manufacturers of renewable heat technologies. I think that the international market for renewable heat technologies is also potentially a huge opportunity for British firms, if we can build a new market at home. Hartnell: Do you share David McKay’s enthusiasm for heat pumps? Barker: Heat pumps are great, but there are a lot of questions that still need to be answered. We don’t have a lot of evidence of how they work in a domestic setting which is why those taking part in the Renewable Heat Premium Payment are feeding information back to us. I’m determined to see a much greater alignment between the Green Deal, with its ambitions to completely transform the energy efficiency of our homes and businesses, and the deployment of renewables. We’ve now done about two-thirds of lofts and cavity walls and it’s increasingly difficult to reach the remainder. We know that price isn’t actually a major barrier. It is inertia. So what we’ve got to do is make this an exciting agenda and renewables are part of that. Hartnell: 5 ROCs for Wave and Tidal was welcomed by the industry, but can you explain the rationale behind the 30MW threshold? Barker: Marine energy is a very exciting technology with the potential to produce 8 nuclear power stations worth of electricity by 2050. Only this week [23rd Jan] I announced the launch of the UK’s first Marine Energy Park in the South West to help the industry fulfil that potential. Under the Renewables Obligation, we
Greg Barker, energy Minister
Gaynor Hartnell, reA Chief executive
want to see a range of different technologies helped – not one scheme potentially scooping the whole ROC budget. We take budgetary control much more seriously than the previous government. There has clearly been learning from the failure of the Feed-in Tariff system that we inherited from Ed Miliband and we’ve now put sensible budgetary controls right at the heart of all new policy. The dynamics of marine are very, very different to solar – we realise that. I’m personally very ambitious for this particular sector. It was my initiative to establish the Marine Energy Programme Board and that’s working very well, bringing together all of the key stakeholders to coalesce around a clear and ambitious vision for the sector. We’re seeing large companies with world-class process engineering skills, like Rolls Royce, enter the market. The combination of the great innovation we’ve seen historically, but that has struggled to scale-up, and the engagement of world-class engineers, who can enable entrepreneurial companies to deploy and
commercialise, added to the political will and the financial support – I think you’re going to find that we’ll see real progress in this sector over the next decade. There are three exciting things for me about the marine sector. Firstly, while it is a nascent technology we are nevertheless world leaders in this field. Secondly, intuitively it strikes a chord with the public. People get the fact that we need to harness the energy of the sea – there is such abundance around our coastline. Thirdly, the industrial potential to create jobs to service not just our own coastline, but actually a global market. If you look at the ability of marine to make an impact on our own decarbonisation programme, it’s meaningful, but not a silver bullet. But the potential for marine globally to be deployed at scale is huge.
“Onsite generation needs to play a bigger part in the energy mix for industry and we need to make sure that government policy isn’t standing in the way.”
Hartnell: Deep geothermal want to know why some of this magic can’t rub off on them. They see themselves in a similar situation and also felt you were quite a champion for Deep Geo. So why aren’t we making progress here? Barker: Over the last 2 years I’ve championed the potential of the marine sector. We’ve developed a very clear route forward to mass deployment, despite tight resources. I’m now turning my attention to geothermal. I will want to look very closely at the RO consultation responses before we make any decision because, like marine, geothermal is a long-term bet rather than a quick win. When
REA NEWS winter 2012
Barker’s leadership on marine means British innovation can spread beyond Scottish waters
you are making decisions against the 2050 roadmap it’s important to make decisions for the long term. There is huge geothermal potential in the UK and I want to see us not only extract that full potential over the coming decade but also build up an industrial supply chain for that technology and potentially make it an important export. I recently visited Africa in the run up to the COP talks in Durban. While there I discussed geothermal with the prime minister of Kenya, where there is around 8GW of geothermal potential. I would love to see British firms in the forefront of the drive to exploit that resource. But we can’t expect British firms to grab a share of a foreign market unless they can show they are credibly exploiting the resource at home. Hartnell: Another part of the sector that sometimes feels overlooked is at the unglamorous and cheaper end – landfill and sewage gas, for example. How can we get them back on the agenda? Barker: Waste gases are in a different category to other renewable sources because of greenhouse gas emissions. You’re talking about an industry that, at one end of the spectrum, should be rewarded but at the other end should be penalised for creating these pollutants. We’ve got to get the balance right between environmental regulation, environmental integrity and incentives for renewable energy generation. At the same time if we are missing a trick by not capturing all the potential benefits then we should look at that.
Hartnell: There are EU waste regulations coming which will impinge on the AD digestate standard we’ve established, and threaten the prospects for biogas plant taking food waste. Can we count on your help? Barker: We’ve got a nascent industry in the UK in the biogas sector and it’s important that we don’t snuff out the early growth that we’ve seen by unnecessary interference from Europe. We need to stand up for UK plc and also just common sense. I will look into the issue but this looks like a common sense measure so, if necessary, we’ll need to put our case effectively in Europe to defend British interests. Biogas is also very important across the EU, so we need to make sure it isn’t jeopardised elsewhere. Hartnell: I want to ask you about what we call the ‘squeezed middle’ – a term I think you’ve heard before! The REA’s always been keen on industrial onsite users getting into the renewables market. They’ve got fantastic sites, with planning less of an issue. But the Feed-In Tariff seems to be mainly for householders now, and it’s only the specialist project developers that are going to cope under the EMR Contract for Difference FIT as it is so complex. Onsite users need a simple approach. We’re worried about them being squeezed out. Barker: I want to give onsite generation a huge boost. But I think we need to look at
what’s worked elsewhere. The industrial economies that shifted the whole balance of power between large-scale generators and small-scale distributed energy are Germany, the Netherlands and Denmark in particular. If you look at the Netherlands, largely because of the oil shocks of the 1970s, they were able to move in a short space of time to a much greater proportion of their energy needs being met from onsite generation, particularly from community and industrial projects. It’s CHP, in conjunction with district heating networks, that offers the biggest opportunity. We are putting a lot more resource at DECC into developing a coherent plan to match our ambitious decarbonisation goals with a strategy to roll out district heat networks at scale. We’ll be publishing a heat strategy later this year to pull together all the different strands – microgeneration, renewable heat and effective distributed energy systems, because for too long they’ve each operated in separate silos. So we need a really integrated heat and electricity generation strategy for distributed sources. Certainly, we can’t rely on the existing feed-in tariffs to drive the scale of ambition we want to see. We need a much more holistic approach that enables that ‘squeezed middle’ to access other sources of funding,
“The potential for marine globally to be deployed at scale is huge. So we really could play a role in not just how to decarbonise the British economy, but how to do something really meaningful on the world stage.”
winter 2012 REA NEWS
Barker was concerned to hear from reA of a risk that new eU waste regulations may pose for the UK AD industry
the Minister asks solar installers to understand certainty means consistency on rates of return, not an unchanging tariff
images: Greenpeace UK, Clearfleau
potentially through EMR. We need to make sure they have fair access to the grid with a decent export tariff. Hartnell: Industrial onsite heat is important, but I’m also thinking about large wind turbines next to factories, and large solar on warehouse roofs. Barker: We’ve got to avoid one-club golfing here. The decentralised energy revolution is about much more than just one technology. And we’ve got to be realistic; we will not realise our ambitions for distributed energy, at real scale, until the costs are sensible. At the moment we’re at an early deployment stage, building the market. But I agree that larger wind turbines on an industrial site are a terrific example of what can and should be encouraged. As the cost of solar plummets, there’s an opportunity to marry this with our strategy for driving the take-up of electric vehicles – people can drive to work & have solar power charging during the day. In the longer term I want to make sure that we’re incentivising companies to make the right choices through the range of regulations that they have to comply with; CRC, Climate Change Agreements – there is a whole raft of measures. I think there is more we can do to streamline these and make sure companies have an effective range of choices. Onsite generation needs to play a bigger part in the energy mix for industry and we need to make sure that government policy isn’t standing in the way. Hartnell: A very direct question for you; why, when the REA recommended the solar Tariffs
come down by 25% back in the first Fast Track FIT review, did you not take that opportunity to cut and say ‘we’re doing what the industry asked for’? Barker: After the CSR people were hugely relieved that we managed to secure £860million for FIT – that was a great result and widely appreciated. Nevertheless we did make clear there was a budget, for the first time in Britain’s new financial discipline, and that there couldn’t be open access to people’s bills. We made clear we would be reforming the scheme to bring forward a German style of FIT degression that took account of deployment and falling costs. The response from stakeholders was very clear; ‘whatever you do, don’t make that cut before April’. The REA may have written to me with a counter proposal, but, it was really focused on minimising cuts for the players rather than anticipating the small scale ‘goldrush’. When we announced the cut to the larger Tariffs we had an even stronger push back against doing anything to domestic tariffs before April 1st. I was clear that my preference would have been to bring in a cut sooner but the majority of the industry at our stakeholder meetings were adamant. I just said we will try and keep to the April 1st timetable with the very important proviso that, if we don’t have a trigger mechanism put in before then, we reserve the right to intervene. The bottom line is nobody called it absolutely right and hindsight is a brilliant thing, but I’m not aware of any submission from the industry that came to me that stands the test of time in light of what we saw happen. The fact of the matter is the deployment above trend didn’t really kick in until August. Even at that stage it was manageable with the deployment that the department had, it was still consistent with the Levy Control Framework.
Hartnell: It’s government’s responsibility to ‘call it’, but I have some sympathy – you’re chasing a moving target in an unfamiliar area for both UK industry and DECC. So what next? Barker: The important thing is that we get the industry on a sound footing and move forward with much more collaboration. That we deliver the transparency and the certainty that the industry and investors want allowing the industry to grow in confidence and continue to reduce its costs, including installation costs. Now that doesn’t mean unlimited subsidy – it does mean real rigour in making sure we have a budget and we respect that budget. I think the industry has to understand that when we talk about certainty, what we’re talking about going forward is giving certainty around the rate of return that can be expected, not a consistent Tariff. I think a lot of installers consistently confuse certainty of rate of return with a frozen Tariff. I’m passionate about getting to the point where we can deploy solar at scale right across the country and I see it as one of the big levers in delivering my vision of far more decentralised energy economy. But we can’t do that on the back of a large consumer subsidy. At the moment we are building the foundations of that vision. We are not at the point where we can afford mass deployment yet, so we have to construct a sensible bridge between the place where we are now and an affordable boom in future. The challenge is how we can get solar through to the point where we can say ‘now go for it – you’re price competitive with other renewables, take the foot off the break and let’s really deploy at scale’. We’re very close, but we’re not there yet. Hartnell: What’s going to happen with the other FIT technologies? Will there be a move to isolate their share of remaining funds? Barker: I am a big fan of solar but I am concerned to make sure that other exciting technologies don’t get put in the shade. We need to ensure that the Tariffs are performing as intended; as a driver of growth in a range of technologies – micro-hydro, micro-CHP, small scale wind – all of these have a role. There will be an opportunity in Phase 2 which we’ll be publishing at the beginning of February for people to bring forward their views. I particularly want to hear in that consultation from other technologies because it is vital that FITs support a range of British technological potential. Follow Greg Barker on Twitter
REA NEWS winter 2012
renewables’ Media Drubbing: How to counter unfair press? A report on media coverage of renewables by the Public Interest Research Centre (PIRC) made a big impact in the REA office. On the positive side, it was a relief to know we aren’t paranoid. But the research confirmed UK media coverage of renewables really is exceptionally negative, particularly in the right-wing press. Environmental journalist Duncan Clark, who reported the story, and leading media lawyer Magnus Boyd say this matters. Read on for their advice and get involved with REA in countering unfair media coverage.
Journalist Duncan Clark, who reported the PIRC research, says that if climate science gets a bad press, the solutions have an even harder time
he PIRC paper, which I reported for the Guardian, is the only research I've seen of UK media coverage of renewables. It is not definitive by any means, but it does paint a picture that chimes with my own experience as a reader: that renewables, and especially wind, take a bit of a drubbing in the British press. Is this significant? I think it is – especially in a country where planning obstacles are a major barrier to renewable energy installations, and in which our clean energy targets already starting to look out of reach. Of course, it is sometimes argued that the influence of the press on public opinion is exaggerated – and there may be some truth in that. But I think on an issue such as renewables, where small numbers of “antis” can block or delay major installations, every negative story or piece of misinformation counts. Perhaps more importantly, as the PIRC report points out, press coverage can influence not only “what people perceive and believe” but also “what
politicians think they believe”. Indeed, politicians partly gauge public opinion partly through the barometer of the press, and consistently negative coverage of renewables will doubtless “limit the perception of political space and impetus for political action”, as PIRC researcher Tim Holmes puts it. So what could those who care about renewables do to improve the situation? I don't think there are any easy answers, but there are lots of avenues to explore. For example, how about trying to get to know those who casually dismiss renewables in the press? One face to face meeting may be worth a dozen response articles in greenminded newspaper or blogs – the result of which may be simply to harden views. And how about working harder to reframe renewables to hit a better range of cultural buttons and start to dismantle the damaging perception that it’s a left-versusright, Guardian-versus-Mail issue? What would it take to persuade Jeremy Clarkson (or indeed Paul Dacre) to go on a tour of the UK's biggest offshore wind turbine?
Surely there’s something in the bravura of those giant engineering projects that could appeal to people like Clarkson if pitched right. Or what about trying to frame offshore wind in the context of Britain’s proud seafaring past? It might also help to try and better understand what most people in the UK really think about rising bills. Do they buy the Mail’s green tax scare stories? Or do they – as I suspect – more readily blame profiteering fuel companies and energy retailers. And if so, what opportunities does that open up? Could there be a way to use community-owned schemes as a powerful symbol of neighbours working together to improve their energy and financial security by reclaiming power (in both senses) from unpopular corporations? Winning the debate won’t be easy of course. So in the meantime, it would probably be worth remembering to regularly remind policymakers that polls suggest most people do support renewables – regardless of what certain papers say.
The REA is interested in forming a new working group to take on this issue in a strategic way, and we need highly motivated REA members to take part. Please contact Leonie Greene (email@example.com) if you are interested. 'Variable Outlook: The portrayal of renewable energy in the media' is available at: www.pirc.info/projects/renewables-in-the-media/ see Carbon Brief at www.carbonbrief.org. 16
winter 2012 REA NEWs
Magnus Boyd, Partner at Carter-Ruck, says it is time to get organised, and REA agrees As a libel lawyer I’m used to defending individuals and corporate bodies from inaccurate or misleading representation in the media. That can be a tough enough task. I’ve become increasingly interested in how renewables – a whole sector – is being consistently misrepresented in the UK media. The PIRC research makes for astonishing reading. One of the difficulties in achieving corrections is that it can be costly and very time consuming. Unfortunately little effort is required to publish inaccuracies and distortions and the constant drip drip of misleading information risks eroding critical public support. It is not in the public interest for the public to be misled. Challenging inaccurate press coverage can be done. Carbon Brief (www.carbonbrief.org) is doing a good job of going after the more outlandish claims. They have achieved a third correction through the Press Complaints Commission to coverage in the Daily Mail suggesting ’green’ measures add £300 to household bills. Nicholas Schoon, reporter at Environmental Data Services (ENDS), published a blog on the Mail’s campaign against renewables (see Carbon Brief), which illustrates just how organised and vociferous misreporting can be. The renewables industry needs to be more organised in its response. I’m looking forward to working with the REA on how we can achieve greater accuracy in reporting, not just in the press, but with the strategic support of forums for journalists on science reporting and standards. Many journalists care passionately about accurate reporting and it will be interesting to learn more about how the renewables industry can provide them with better information.
REA’s ‘Back Biomass’ campaign Paul Thompson, Head of Policy, explains REA’s efforts to win unequivocal support for biomass power and CHP.
energy Minister Charles Hendry and Gaynor Hartnell at the 'Back Biomass' reception
he next six months will be crucial for large-scale renewable power. Decisions on levels of support under the RO for 2013-2017 are likely by the summer, with changes put into law shortly afterwards. Yet the messages on biomass power and CHP from government are very mixed. On the one hand, DECC acknowledges the great potential of biomass power as a mature and cost-competitive technology. By
generating baseload electricity, biomass can complement and support the growth of other renewables, such as wind and solar. Official projections give biomass a large role to 2020 and beyond. On the other hand, its important contribution is rarely publicly championed by ministers. The impression is that ministers know they need it, but almost wish they didn’t. In part this disconnect is due to the political environment. There are various campaigns running against biomass power at the moment. Campaigning tactics range from posters on buses and the tube, to sending small trees to MPs with the message; “When I grow up I want to be an item of furniture”. The REA has launched a fact-based campaign, with Edelman as advisors, to make the best possible case for the industry. Our campaign is focussed on the benefits of biomass power and CHP, and the levels of support needed under the RO. The campaign
website features information on key policy issues, case studies, and latest news stories. Awareness has been raised among MPs and other opinion-formers through a series of one-to-one meetings. Our campaign reception in December was attended by Energy Minister Charles Hendry – a very welcome show of support. As DECC weighs up responses to the RO Banding consultation, we’re stepping up our activities. We organised a letter-writing campaign early in the New Year and are looking to build on our Parliamentary contacts with questions and debates. There’s also a new biomass all-party parliamentary group, which should help maintain links with supportive MPs in the long term. We’ll be doing more media work too, both reacting to stories and looking for opportunities to get our own, positive stories reported. Now is the time to back biomass! See www.backbiomass.co.uk
REA NEWs winter 2012
RO Banding Review: A mixed outlook for renewable power Senior Policy Analyst Tricia Wiley gives an overview of these critical policy proposals.
overnment finally published the much anticipated RO Banding Review consultation in October 2011. We had expected this in July, yet in September we found ourselves writing to Ministers to stress the importance of publishing the proposals as soon as possible. Getting the banding levels right is vital. Equally vital are the key design and administrative aspects of the scheme, particularly the arrangements governing the ‘vintageing’ of the Renewables Obligation, and the transition into Contract for Difference Feed-in Tariffs (CfD FITs). In general the proposed banding levels should allow projects to proceed, but this will be dependent on the ability of generators to secure a sufficient market price and on key Electricity Market Reform (EMR) proposals being successfully implemented, particularly the carbon floor price. These two factors will have a major impact on the economics of a project.
image: Greenpeace UK
the gOOd news After the disappointment of securing just £20 million under the Low Carbon Innovation Budget, the banding proposals came as much needed good news for wave and tidal stream. Both will be eligible for 5 ROCs, but are subject to a 30 MW project cap. This size limit is far from ideal, but deployment beyond this scale is unlikely in the next couple of years. The increased ROC support will encourage sorely needed private investment to take demonstration wave and tidal projects into commercialisation in England and Wales. Going forwards the cliff edge for projects over 30 MW from 5 ROCS to 2 ROCs is far too drastic. We will need DECC to use data from new projects to inform sensible support levels for all size of wave and tidal projects under the CfD FITs. the nOt-sO-gOOd news Government is proposing to reduce hydro to 0.5 ROCS, which is insufficient to incentivise new projects. Energy from waste CHP also saw
its support level decreased to 0.5 ROCs, based on questionable analysis in the Arup report on costs. Due to the complexity of demonstrating biomass content, and of achieving challenging ‘good quality CHP’ requirements, there have been very few EfW projects accredited even at 1 ROC. Just as gasification and pyrolysis developers were set to deploy their first projects, they have been presented with the uncertainty of a new definition for qualifying technology, meaning some projects face support being slashed to just 0.5 ROCs – a quarter of previous support levels. Although DECC are engaging with developers on proposals, and we are lobbying hard, it is not a comfortable position for an emergent industry to find itself in. The proposed 2015 end date for the CHP 0.5 ROC uplift is far too soon, given a prolonged period of uncertainty around RHI support and the subsequent reduction in the RHI tariff for larger biomass. CHP plants are complex to contract, and take a lot longer to develop than non-CHP plants. The CHP uplift should therefore be available until 2017, when the RO is no longer open to new projects. Some industry players are concerned with the biomass proposals on sustainability and the general commentary around biomass and government’s long term aspirations. However, biomass developers in Scotland face bigger issues with a proposal simply not to support electricity projects above a certain size threshold – this is currently under consultation. Finally, deep geothermal developers were hugely disappointed at remaining on 2 ROCs – a level of support which is totally insufficient for this important technology. ReA chAllenging degRessiOn RAtes Oddly, Government has proposed degression rates for most technologies in line with offshore wind. These reductions occur over a relatively short time period, and they do not reflect the real learning rates or cost reductions of other technologies. It is extremely damaging for government to propose any rapid stepping down in the banding levels, particularly for those technologies that have deployed very little. The feedback from member is that while these degression rates might make a small
“Investment stability and certainty is crucial and is key to enabling the UK to meet its targets and for renewables to contribute to green economic growth.” gAynOR hARtnell, ReA chief executive
pelamis wave power machine. wave and tidal developers are greatly relieved by the 5 ROc proposals
difference to DECC budgets, they risk making a big difference to increasingly nervous investors. There are many reasons why projects can be delayed and risk missing their commissioning date and associated banding level. We welcome DECC’s consideration of grace periods but we feel they need to last longer than the mooted six months to address these concerns. dOn’t pick winneRs Picking winning technologies or making decisions that potentially exclude some technologies now could limit important options in future. Evidence continues to mount that in the longer term renewables can protect electricity consumers from large increases in fossil fuel prices and volatile global markets. The commitment to supporting renewable electricity post 2017 should shortly be revealed as industry waits for more details on the CfD FITs. Developers looking to commission projects before 2017 will have to wait until Spring when the final decision on the banding proposals is expected.
tricia wiley, senior policy Analyst, ReA firstname.lastname@example.org
winteR 2012 ReA neWS
Silver Lining for
Deep Geothermal T
Dr Ryan Law at the United Downs industrial estate, near Redruth in Cornwall, site of the UK’s first deep geothermal electricity station
the potential of the deep geothermal industry in the South West of the UK. The geothermal industry was disappointed at the outcome of the RO Banding Review. However, this grant will help the industry move forward.” REA hopes the project will convince DECC to back deep geothermal heat and power. Prime Minster David Cameron promised to provide “generous incentives” to kick start the deep geothermal industry when he
visited Cornwall before the election. However, support was cut and the UK sector now lags behind other major EU countries despite offering to greatly expand the drilling, geophysical, and manufacturing sectors in the UK. DECC’s 2050 Pathways Analysis predicts Deep Geothermal could supply 35TWh, or 10% of current annual electricity demand. This would translate to a theoretic potential to deliver a third of UK heat demand. However, recent developments in drilling technology and geophysical techniques mean that it is increasingly possible to engineer systems in ‘hot rocks’ at depths beyond 5km. The German Geothermal Association believes geothermal power could supply Germany’s electricity needs 600 times over. Little surprise then that Germany is investing €4 billion in 150 new deep geothermal projects which provide on-demand power and abundant heat.
image: Geothermal engineering Ltd
he RO Banding review left the deep geothermal sector reeling but there was a silver lining in the form of a £6 million Regional Growth Fund grant towards a £50 million project by Geothermal Engineering Ltd. The Cornwall plant will produce 10MW of electricity, to be fed into the National Grid; and 50MW of renewable heat energy, which will be made available for local use. 10MW of electricity is enough to power 20,000 homes, while 50MW of renewable heat is equivalent to the heat needs of 20 schools. The site already has planning permission and Geothermal Engineering Ltd aims to begin drilling the first well onsite later this year. The project will be the first to generate electricity in the UK as well as heat, adding to established geothermal heat projects, such as Southampton Geothermal Heating Company. Dr Ryan Law, Managing Director of Geothermal Engineering Ltd, and Chair of the REA’s Deep Geothermal Group, said: “We are pleased that the government has recognised
Rea newS winteR 2012
rea_PG19_deep geo_m+w.indd 1
FITs: Riding the solarcoaster After the upheaval of the first Fast Track FIT Review, REA’s Head of External Affairs Leonie Greene reports on even more challenging developments demanding all our skills and experience.
he REA has strong ownership of the FITs; we secured the legislation in the 2008 Energy Act after a successful campaign alongside Friends of the Earth. The early capping of the FITs following the Comprehensive Spending Review by the Coalition Government set alarm bells ringing in the REA office. No FIT scheme has operated successfully internationally under an inflexible cap. That fateful cap, combined with DECC’s difficulties with tracking volume and prices, has resulted an inevitable crisis, widely reported in the media. we see a crisis coming, and we prepare REA and the Solar Trade Association (STA) had warned its solar members to avoid making significant investments before the fateful second FIT Review was launched in at the end of October last year. Our industry intelligence meant we knew volumes were exceeding DECC projections of 86MW for 2011/12. We were frustrated that our recommendation to reduce all tariffs by 25% in August in the best interests of the industry had not been heeded – especially given the pains we had taken negotiating it with the members. Stuart Pocock, REA’s Technical Director (then Acting Director of STA) analysed REAL data to quantify the number of jobs in the UK solar industry. We knew this would be an essential case to make. Sure enough the figures were widely picked up in the media, in Parliament and by campaigners. we lock-in with members REA quickly organised an industry survey to determine likely impacts of the FIT Review. Our survey was answered by 140 companies and it showed around 70% felt able to weather the changes, albeit most felt they would have to downsize. As time went on we became increasingly confident the Tariff cuts could be accommodated by the domestic market, but that the energy efficiency requirements were potentially a killer. Further member feedback including on the Judicial Review suggested most companies
found the legal wranglings frustrating. We urged the Secretary of State not to allow legal disputes to impact on the outlook for all FIT technologies. we focus on solutions REA and STA staff quickly realised the greatest threat was not cuts, but primarily the limited budget, followed by inappropriate energy efficiency requirements. While campaigners raged about the cuts, REA argued at DECC’s Industry Roundtable that it would be crazy to destroy the industry for want of a short period of additional support to tide the industry over to the point when 2 ROCs support would be sufficient. The Minister listened and challenged us to demonstrate the ‘glide path’ down to 2 ROCs. We did that, and more. REA’s extensive modelling enabled us to cost the amount of support necessary to stabilise the industry at its current size (i.e. a 1GW workforce) and we presented this in person, to the Secretary of State, Chris Huhne. we make our asks crystal clear Members told us that while the six week timetable and 12th December reference date had been shocking, the tariff needed to come
down and they would rather look forward. Therefore challenging the implementation date was far less important than securing the industry over the next three years. We knew the budget was committed well before DECC confirmed it and that more funding had to be found. Over 200 prominent individuals and companies signed our letter to David Cameron and Nick Clegg asking them to secure the industry’s future. REA Chief Executive Gaynor Hartnell delivered the letter to No.10 in person, alongside Caroline Flint, Caroline Lucas, Alan Whitehead, Tessa Munt, Howard Johns and Friends of the Earth. we see and represent the big picture and all technologies Far from wanting to see ambition for FITs constrained, REA wants it expanded and encompassing more technologies. That’s because a wide range of important investors will be lost, because of reduced eligibility for FITs (and the budget), and the Renewables Obligation and EMR being too complex. Inflammatory rhetoric in a crisis won’t help REA achieve its broader goals, however frustrated we may feel. The sad fact is that UK politicians who understand the transformative decentralised renewables agenda are few and far between. And nobody should underestimate the enormous challenges relatively supportive Ministers face transforming vast departments used to decades of business-as-usual. With approachable politicians like Greg Barker it can be easy to forget how much power they wield. REA never forgets, and our spread across all technologies means we can quickly recover relationships if tensions emerge in any area. All in all it’s hard to recall a more challenging time for external relations.
top team: stuart pocock (left) marshalled myself, uk pV expert ray noble and mike landy (right) into an effective team. modelling enabled us to cost solutions to the crisis
winter 2012 REA NEWs
rea_PG20-21_solar and real.indd 2
rea’s jobs analysis was widely picked up, including by the independent ‘cut don’t kill’ campaign
gaynor hartnell with libdem mp tessa munt delivering letters to nick clegg and david cameron urging them to safeguard the solar industry
images: Gavin Rodgers, Cut Don't Kill, REA
I’ve been impressed at the pragmatic and constructive approach shown by so many of our members. Of course there are sometimes strong differences of opinion, but our task is to inform and distil the balance of views and avoid knee-jerk reactions which could damage the longer-term prospects for the sector. Nobody should think our measured approach reflects detachment. REA staff are hugely passionate about renewables and painfully aware the national rate of progress falls far short of what is needed. As Gaynor’s interview with Greg Barker shows, the Minister largely grasps the great potential of solar. The challenge now is to persuade him to be ambitious enough going forwards to enable UK companies to
real chief executive Virginia graham (centre) and the real team handled 200 calls a day
strengthen their position in what the IEA and IPCC agree could be the biggest energy sector in the world in 50 years. That depends on expanding the limited FITs budget, and securing volume to drive costs down. We also urgently need wider Government recognition of the obvious jobs and tax revenue benefits. The Comprehensive FIT Review should be published in early February. REA will want to see the future safeguarded for all FIT technologies. And the fundamental problem of that inflexible cap and the potential for more crises still looms large... real also rises to the challenge Over the six week consultation period the REAL team was inundated with 200
“This was a huge shock to our systems. We were taken completely by surprise by the huge volume of calls we received. But the team was magnificent and coped really well with everything callers threw at them. Within a day or two they had become experts in all the obscure twists and turns of DECC’s proposals. They made it a point of honour to responded to every query as fully as they could.” Virginia graham, chief executiVe, real assurance
calls a day from confused installers and consumers alike. REAL CEO Virginia Graham supplemented the core team of eight with two additional temporary staff. Team members suspended all their day-today work to ensure all hands were on deck to take the calls. Some days team members took more than 35 calls a day. On 10th and 11th December REAL stayed open all weekend to answer queries and resolve problems. To reduce the calls, REAL posted Frequently Asked Questions on its website for both installers and consumers, and kept these as up-to-date as possible. REAL worked with other bodies including EST, MCS, Ofgem and DECC to make sure everyone was giving the same information and to prevent callers from being passed from pillar to post. Throughout they kept a vigilant eye open for any signs of malpractice and fraud, and reported any suspicious behaviour to DECC and Gemserv. REAL is now working through a long back-log of complaints.
léonie greene head of external affairs email@example.com
REA NEWs winter 2012
rea_PG20-21_solar and real.indd 3
Food and Fuel 1: On-farm AD
aD can support sustainable farming systems and tackle damaging methane emissions
A new report by REA and Masstock is helping the AD industry explain why on-farm AD need not mean policy conflict
n August, the REA’s Brittany Vogel and Roger Hellawell of Masstock Smart Farming, with contributions from REA Head of Biogas David Collins, co-authored a valuable report on the sustainable application of anaerobic digestion (AD) in UK farming. Part of the reluctance to properly support on-farm AD may be because of concerns over the necessary addition of crop feedstocks or grasses to readily available animal slurries. The political anxiety that these additional feedstocks for AD will displace food production is likely to be part of the reason why the Coalition Government’s promised ‘massive’ expansion in AD has yet to materialise. However, marginalising the uptake of AD on UK farms means that animal slurries are spread on land where they release methane, a potent Greenhouse Gas. It is estimated 90 million tonnes of animal slurry are produced in the UK each year. The new report says that far from
representing a threat to food production, the fresh feedstock component required by AD poses no such threat if produced as part of a sustainable farming system using a crop rotation system that incorporates a ‘break crop’ for use in AD systems. It is well known that ‘break crops’ naturally improve soil quality and thus productivity. AD also produces a ‘digestate’ that can be used as a fertiliser on-farm and which in most cases can displace most of the need for fossil fuel based fertilisers, saving even more carbon. Furthermore, the report explains that the UK is a net exporter of wheat, and these exports are generally used as animal feed rather than for human consumption – hence repurposing this land for AD is again not
adversely affecting the global food supply to poorer countries. Co-author Roger Hellawell of Masstock Smart Farming said; “The goals of food production, energy supply and environmental sustainability can be met, but it requires imagination, not stagnation, in the countryside. We need to embrace change instead of freezing our countryside and curtailing land use. We need research and development to improve yields; while plant breeding and improved husbandry can surely meet our increasing food demand. In global terms our biggest contribution to ending hunger is knowledge transfer.” The report is available to REA Biogas members in the members’ area at: www.biogas.org.uk.
“This useful new report formed the basis of a joint industry position paper. It was discussed in a Defra workshop in November and resulted in a reasonably positive write-up. We now hope to see a more formal statement that the Government are revising their position in favour of on-farm AD”. Dr Jonathan Scurlock, chief aDviSer, renewable energy anD climate change, nfu
winter 2012 REA NEWs
Food and Fuel 2: Biofuels
the animal feed industry is interested in using the high-protein by-products of biofuels production
Leading animal nutritionist Dr Michael Marsden of AB Agri says you can deliver efficient land use by producing animal feed and biofuels together
images: crabchick, David F. Bacon, Vireol
K biofuel production drives the demand for home-produced wheat and rape seed while generating valuable animal feed products for UK livestock. The common practice of importing high protein soya bean-derived animal feed from the Americas is under scrutiny from environmentalists due to issues around sustainability and genetic modification. One way to respond to this challenge is to increase the supply of home-produced high protein animal feed ingredients. The challenge is to do so in a way that is both environmentally sustainable and cost effective to producers. Bioethanol production might hold the solution to this problem. UK bioethanol production generates a 33% protein dried distillers grain (DDGF) and a liquid syrup. DDGF can offer significant soya and wheat savings, as it can substitute for approximately 55% of the soya and 45% of the wheat
currently used in cattle diets. Use in pig and poultry feeds is more complex but the principle still applies. The syrup provides additional protein, drives intake, and provides alternatives to imported sugar molasses products that continue to trend up in price. Moist distillers’ products provide similar benefits to ruminants as the liquid syrup, but are not appropriate for other livestock. However, they do allow the farmer to feed less forage, thereby releasing land for alternative cropping. Plus they are associated with the stimulation of feed intake, which leads to higher production – so potentially more
products from fewer animals. In spring 2012 the Vivergo bio-ethanol plant will add an estimated 390,000 tonnes of dried distillers’ feed, 130,000 tonnes of moist distillers’ feed, and 30,000 tonnes of the liquid syrup into the domestic UK animal feed marketplace. Biodiesel production can also generate significant quantities of additional rapeseed meal protein, as well as glycerol, a highenergy feed which livestock can readily convert to glucose upon digestion. Feeding glycerol to early lactation cows helps reduce the energy deficit, allowing them to produce to their potential and improve the chances of conception. Subject to purity, glycerol could theoretically be fed to all livestock, further reducing the need to import palm and other oils. With a little extra processing, UK-produced rapeseed meal protein can provide an alternative to soya bean meal for dairy cows, reducing the need for imports even further. Industry will continue to pursue these alternatives. See page 10 for Vireol’s bio-ethanol plant which will also produce animal feed ingredients.
REA NEWs winter 2012
Developer and operator of food waste and on-farm AD plants in the UK
Adgen Energy is a renewable energy project development company, formed to develop and finance renewable energy plants across the UK. It has a highly skilled and experienced team in AD project development, finance, design, construction and operations. We are resourced to fund and deliver projects, independently or in partnership. For further information Email: firstname.lastname@example.org
Getting to 15% and beyond Dr Bernard J Bulkin, Chair of DeCC’s Office of Renewable energy, explains the strategy for meeting the UK’s renewable energy target.
images: DeCC, Greenpeace UK
ommitment to the goal of deriving 15% of our energy from renewable sources has been repeatedly reaffirmed by the Government, and is supported by all major parties and devolved administrations. In July of 2011, the Government published the Renewables Roadmap, which set out, in detail, the role that different renewable technologies could play in achieving this goal, and the barriers to making it happen. The role of government is to support renewable technologies so they become cost competitive with fossil energy, and to remove barriers to efficient and effective implementation, while ensuring that in the process the UK fosters its goals of economic development and energy security. How can we make all this happen? Simply put, we must focus on ‘what matters’ and not be distracted by issues and activities that are not material to achieving the goal. So, what are the things that make a difference? BiG thinGs As we made clear in the Roadmap, seven main technologies will comprise the bulk of the contribution towards the target. There is uncertainty about the scale that each of these technologies can achieve, as each one has factors which could keep it from achieving the central estimate. Nevertheless, these are gigawatt opportunities and, if we work effectively on the barriers and support mechanisms, we can produce big industrial development in the UK, and keep our energy affordable. Latest research from DECC shows that so far this financial year, companies have announced plans for almost £2.5 billion worth of investment in renewable energy projects in the UK,
with the potential to create almost 12,000 jobs across the country. Focussing on the big opportunities means not diverting our resources to technologies that can only make smaller contributions, even though these may be cost effective in specialized situations. efficiency Our target is expressed as a percentage of total energy use, so the denominator is just as important as the numerator. Our plans, as set out in the Roadmap, use current estimates of demand for heat, electricity and transport for 2020. But we know that there is much greater efficiency possible, and it is probably the lowest cost thing we can do. The newly established Office of National Energy Efficiency will drive this important agenda forward. costs Some renewable energy sources are already competitive with fossil energy sources, or are moving on a trajectory to get there in the next few years. For others, a concerted effort across the entire supply chain is required to get costs down. Of the seven big things contributing to the 2020 goal, offshore wind is currently the most expensive, and a cross industry task force is working on a large number of initiatives to make a step change reduction of costs and to increase output.
finance How much can be built, at what pace, and at what energy cost, depends on the ability to attract finance, with the cost of capital being dependent on perceived and experiential risk. Government and industry need to work together to attract finance to the renewable energy sector, recognising that each technology has its own challenges – there is no single approach. While the amount of money required is large, we view this positively. The renewables sector in the UK is one of the greatest opportunities for investment in the world today; it offers transparency, certainty, and long term stability. GriD For the electricity part of the Renewables Roadmap, grid connection is crucial. But we must do more than ensure timely and efficient connection of new generation. We must use this opportunity to create the grid that we need for the 21st Century. In all of this, we recognise that 2020 is only the beginning. Some of the industries that we build now will continue to double and triple in size in the following decade. Others will be replaced by newer technologies only now in the prototyping. We can achieve the 2020 target to which we are committed, and in so doing build the base to go far beyond.
Big solutions; chris huhne at Vestas r&D headquarters on the isle of wight
winter 2012 Rea news 25
rea_PG25_bernie bulkin.indd 1
Project TransmiT Decision Time for Transmission Charging early 2012 is the time for major decisions to be taken in Project TransmiT – but what is it and why is it so important for all Rea members working in renewable power? Tim Russell explains.
roject TransmiT, initiated in 2010, is the Ofgem review of transmission charging and associated connection arrangements. It comprises two work streams; firstly connection arrangements (changes to the financial security required for a connection and the timeliness of connections). The other work stream deals with the charges for using the transmission system. However, transmission charging affects even those projects connected to a distribution network. Most of these projects are not liable for transmission charges directly, rather they can benefit from offsetting transmission demand through positive demand charges. Many believe the best part of nine months was wasted discussing ideas and charging concepts that could have been easily ruled out at the start. Only last summer were choices of charging methodologies to be considered narrowed to three serious options. We were disappointed that a good option supported by REA was not considered. A Technical Working Group was formed to consider these three methodologies. Outcomes of each methodology were modelled by consultants in terms of likely costs, future plant mix, carbon intensity and renewable penetration. The results, together with Ofgem’s current thoughts, were published before Christmas with views invited by 14th February. Ofgem will then make a
decision and, if the decision is to change the current charging methodology, Ofgem will instruct the National Grid Company to set in place the formal change procedure (bringing forward a change to the Connection and Use of System Code). Any changed charging methodology would then probably be introduced from April 2014 (although April 2013 cannot be ruled out). The three main charging methodologies on the table are: l The status quo, known as Investment Cost Related Pricing (ICRP) under which charges vary by geographical location and all generators at a particular location of the same size pay the same charge. l “Postage stamp” or “socialised” charging under which all generators in Great Britain pay the same tariff with charges based on volume of electrical energy generated. There is a variation proposal where the “local” transmission charges can vary according to the cost of the network assets required to connect the generator to the main interconnected transmission system. l An improved ICRP methodology recognising that, in future, the way the transmission system will be designed to accommodate intermittent generation will be different to the way it was designed in the past and it needs to better reflects the costs of the associated required transmission networks in the
CurrenT reA PosiTion Transmission charging methodologies are generally contentious amongst groups of generators, as methods that would reduce charges for some will generally raise charges for others. The REA has always favoured “cost reflective” network charging on the basis that it will produce the most economic overall realisation of any given set of objectives (for example renewable generation penetration). It is also fair that generators in an area that requires greater transmission investment pay a larger transmission charge than those in areas that don’t require investment. Our draft response to the consultation circulated to members in early January reflects this. We are also seeking to ensure that generators on islands are not overcharged for the circuits connecting the mainland to the island and are requesting that a lower proportion of transmission system costs are paid by all generators, in line with most other European countries. For questions on the proposals members can contact Tim directly.
Tim russell, reA’s networks Adviser email@example.com
image: Greenpeace UK
The complex transmission charging agenda should matter to all renewable power generators
charges levied. Ofgem has indicated that it wants to abandon any further work on the postage stamp methodology and it is currently in favour of the improved ICRP methodology. REA is reasonably happy with that. The proposed ICRP methodology shows more sensitivity to the characteristics of intermittent renewables and offers transmission charging more reflective of true costs. It is not seeking, for example, to load a part of transmission charges associated with meeting peak demand on intermittent renewables because it is not essential that they are not constrained from generating at peak demand times. A balance is sought between building network capacity and constraining intermittent generation when networks are congested. The improved ICRP will charge intermittent generators for the resultant network built.
Rea news winTer 2012
rea_PG26_project transmit.indd 1
The eighth year of this leading industry event sees waste derived energy playing its part in the lowcarbon mix more significantly than ever before. The programme includes: policy developments across energy and waste; updates on financial support mechanisms; a detailed consideration of financing, particularly for C and I wastes and smaller projects; the development of the SRF market and how this is becoming a lowcarbon choice for high-energy using industries; decentralised generation, the demand for lowcarbon heat and the role of EfW; analysis of emerging markets and cutting edge technologies for hydrogen production and transport fuel. Discussion panels featuring the industry’s top experts provide unique opportunities to explore the challenges and opportunities that the energy from waste industry faces. Gaynor Hartnell, Chief Executive of the Renewable Energy Association,
will be taking part in a key discussion on Day 1 on the implications of the government’s financial support mechanisms. Energy from Waste 2012 provides two full days of top level information, authoritative industry comment and numerous networking opportunities with industry leaders, policy advisors and opinion formers. This year the conference also features optional site visits and breakfast seminars. See www.efwlondon.eu; call 01722 717031 / 33; email firstname.lastname@example.org Members of the REA receive a 10% discount off the standard delegate rate.
See www.efwlondon.eu for full details.
The Green Revolution is Here – Installers Enquire Within! REA Newsletter Treco was established in 2006 to supply and install biomass boilers to a growing client base. They are one of the UK’s leading biomass installers, having supplied and installed over 250 biomass boilers nationwide. The phase 1 commercial Renewable Heat Incentive (RHI), which pays eligible biomass boiler owners for generating green heat, will create thousands of new biomass boiler installations and jobs in the renewable energy sector. The RHI is particularly beneficial to rural businesses and landowners, who’s fossil fuel usage may be high from providing continuous heat to larger buildings. Where multiple properties are heated by a single boiler under “district heating” schemes, RHI payments can be particularly appealing. Treco’s “RHI Calculator” is available from their website and enables
the calculation of fuel cost savings from switching to biomass, the RHI payments over 20 years and the capital cost payback period. For example, a farm using a 50kW biomass boiler may receive around £5,000 a year and a hospital using a 198kW system could receive upwards of £25,000, with a 4-6 year payback. Biomass boilers under 45kW must be Microgeneration Certification Scheme (MCS) accredited and fitted by an MCS accredited installer to qualify for RHI payments. The national shortage of qualified biomass fitters is an opportunity for the plumbers and heating engineers needed for the thousands of new biomass boiler installations that the RHI will create. Both Treco and their top-of-the-range Guntamatic boilers are MCS-approved and installers wanting to find out more about working with Treco should contact them on 0845 130 9130 or via www.treco.co.uk.
REA NEWS winTER 2012
Lindsay Barnett, Head of operations, presents tHe events HigHLigHts
rea’s exhibition stand at power of 3
October’s EBEC bioenergy conference expanded from the previous year to include two parallel exhibitions: Microgen, which focussed on small-scale renewables; and Nextgen, looking at the future of energy generation. Together the three conferences were billed as ‘The Power of 3’. The REA was the strategic partner at this popular event which attracted over 3,000 visitors including farmers, installers, builders, land owners, architects, local authority representatives and many others. Delegates could see the latest technologies and choose from 190 topical and case study-led seminars and workshops. This leading exhibition and conference now offers visitors over 80 hours of learning and networking opportunities free of charge. The strategic partnership with this expanded event is now even more fitting for REA because it better reflects the interests of our diverse membership. The partnership ensured that REA’s policy expertise shone through in the topical conference programme. Our expert staff were on hand to share their knowledge across all renewable technologies. REA also exhibited at the conference alongside the Solar Trade Association and Renewable Energy Assurance Limited. This year’s event is now named Nextgen, incorporating EBEC and Microgen, and it will again be held at Stoneleigh Park on 10th & 11th October. The event has already booked even more exhibitors than 2011 so don’t miss out – book your stand now by visiting www.nextgenexpo.co.uk
Greg barker addresses UK solar industry
Minister greg Barker spoke as fit cut threats appeared in the media, the Minister explains his plans for solar to rea's Leonie greene and sta's ray noble
REA was a partner to Solar Power UK 2011, the UK's largest solar power conference, held in Birmingham and chaired by STA's Ray Noble. The event was organised by Solar Power Portal and brought together over 3,600 attendees to meet almost 500 industry representatives. With the industry abuzz with media reports of a potential cut in the solar FITs to 9p, delegates were on tenterhooks to hear first hand from DECC Minister Greg Barker. The Minister assured the industry he was fully committed to its future, but used the occasion to announce his intentions to link energy efficiency measures to solar FITs.
images: solar Media Ltd, NextGen Media Ltd
REA CElEbRAtEs thE PowER of 3
Promoting marine renewables in the Commons peter aldous Mp addresses the marine renewables reception
REA supported the Seabed User & Developer Group (SUDG) parliamentary reception in November. The SUDG, in which the REA participates, held the event to outline the crucial role of marine industries in creating jobs in coastal communities. The significant broader economic benefits marine renewables can deliver across the UK were also highlighted. The event was hosted by Peter Aldous MP and the keynote speaker was Sir Bill Callaghan, Chair of the Marine Management Organisation. Around 90 people attended the reception, including Dr Steph Merry and REA’s Ocean Energy Group Chair Max Carcas.
Renewables Enter the Dragon’s Den This exciting new Dragon’s Den-style event, which was held at BDO’s London Offices on 18th January, showcased innovative new energy generating ideas such as: algae photo-bioreactors, a new class of sea and wind turbines, bio-char and bio-coal, several waste to energy ideas and two new sea powered energy generation concepts. If these technologies sound unfamiliar that’s because many of the proposals were being publicly aired for the first time. The ‘Dragons’ were a panel of finance, legal and industry experts with broad experience and skills who interrogated the presenters on project viability, financial hurdles and proof of concept. REA’s own Chief Executive, Gaynor Hartnell admirably undertook the Evan Davies role. There was plenty of opportunity in the bar afterwards for potential investors in the audience to express their interest in the proposals on offer. The evening session was collaboration between REA, BDO and Nextgen. B9 pitch their wind and biofuel powered sailing ship to the dragons
winter 2012 REA NEWs
rea_PG28-29_events&future events.indd 2
reguLar and fortHcoMing events
to register for REA events, be it our seminars, workshops, or members-only sector group meetings, you can now visit our newly refreshed website at www.r-e-a.net and register on-line. rea Biogas’s operators & pLanners courses
images: solar Media Ltd, NextGen Media Ltd
The third of our 5 day, in-depth biogas courses in association with IBBK (The International Biogas and Bioenergy Centre of Expertise) was held in January. speakers with many years of practical experience in the German biogas industry together joined the UK experts to impart their knowledge to those planning to build a biogas plant, invest in the industry, or simply discover the wonders of AD. These courses now run every 6 months.
rHi 2 witH ernst & young The second in our Renewable Heat Incentive series of seminars, open to both members and non-members, was held on 1st February. This seminar followed on from RHI 1 last year, where attendees could question and challenge DECC officials directly. Ofgem presented at the latest event, taking delegates through the RHI scheme for large-scale installations and the accreditation process. RHI 3 will follow the consultation on ‘phase 2’, due in spring 2012.
images: REA, solar Media Ltd, NextGen Media Ltd
The REA’s Renewables Obligation Workshops are firmly established as an extremely popular course and the next one on 1st March is proving no exception. Experts from the REA’s policy team talk through all aspects of the RO and set out its transition into the “Contract for Difference Feed-In Tariff” as part of the Electricity Market Reform, which will eventually replace the RO as the main mechanism for deploying larger scale renewables.
BioMass Heat paviLion at ecoBuiLd preferentiaL rate for rea MeMBers!
our brand spanking new website
REA is pleased to announce the relaunch of its website on 1st December. The refreshed, easy-to-use format gives a concise overview of individual technology areas while still offering indepth information for those wishing to learn more. There is a new user-friendly members area too. Members are encouraged to log-in to obtain specific sector group information and additional communications on our ongoing project work. You can also easily amend your company details to keep them reliable and up-to-date. We recommend that members upload their logos and link their websites to ours.
7tH BritisH renewaBLe energy awards now open for noMinations REA's British Renewable Energy Awards is a major event in the UK renewables calendar. On 21st June 2012, the REA will host the annual Awards and Gala Dinner at Jumeirah Carlton Tower, London sW1. Nominations are open now, so if you know someone who’s done amazing things in or for renewables in the past year, please visit the events section of our website, follow the link, and submit an entry. You can even nominate yourselves. You’ll also find detailed information on our Award categories, last year’s winners, and essential promotional and branding opportunities. In february we will open our new online bookings system for the Awards, so keep a look out on www.r-e-a.net and reserve your places AsAP as we are anticipating another fantastic sell-out event.
The REA is working closely with the organisers of Ecobuild 2012 and has arranged a special Biomass Heat Pavilion at the event which will be held the 20th – 22nd March 2012 at ExCel, London. The REA has organised a preferential exhibitor rate for REA members and should have a dozen companies participating. If you are interested in exhibiting as part of the pavilion, please email email@example.com for more details. renewable energy awards 2011
REA NEWs winter 2012
rea_PG28-29_events&future events.indd 3
Renewable Heat Comes in from the Cold
Paul Thompson, Head of Policy, is delighted to celebrate a truly positive development at a time of huge uncertainty in energy policy
Shape of things to come? Solar thermal panels heat this swimming pool in Sweden – even in the snow!
It was a further nasty shock when it became clear that Commission approval required one of the tariffs (for solid biomass 1MW and over) to be reduced from 2.7p to 1p – a reduction of more than 60%. Nevertheless, the various procedural hoops were gone through and the scheme finally went live on 28 November 2011. The RHI is definitely a positive, but that’s not to say it’s perfect; there are no liquids, air source heat pumps, or uplifts for district heating. Solar thermal and biogas are only included under 200kW(th) and there are tight restrictions on the use of biomass in waste. One of the most striking drawbacks is the current exclusion of single domestic
installations. Given the complexity of the policy, it’s hardly surprising Ofgem’s official guidance runs to well over 200 pages, although their website also carries factsheets and details of email and phone enquiry lines. DECC intends to launch a ‘phase 2’ consultation this year to deal with as many of the limitations of the current scheme as possible. The timing has slipped following the European Commission’s intervention, so implementation as planned in October 2012 looks unlikely. There’s a great deal more to do for renewable heat to fulfil its potential, but RHI phase one is definitely a good place to start.
image: Greenpeace UK
aving long been an afterthought – at best – renewable heat now has its own dedicated policy. Biomass boilers, ground source heat pumps, solar thermal and biogas can receive tariffs based on p/kWh of eligible heat generation. There is also a separate tariff for upgrading biogas to biomethane and injecting it into the gas grid. The tariffs are intended to cover the increased costs of going renewable compared to fossil fuels and give a return on that investment. Once on the scheme, tariffs are guaranteed for 20 years and will be adjusted in line with inflation. The scheme has big ambitions, with the aim of 12% of the UK’s heat being renewable by 2020. This is essential if we’re to meet our climate change and renewables targets, as heat accounts for a little under half of both the UK’s energy demand and greenhouse gas emissions. It’s been a rocky road since the REA led the campaign to get the primary legislation in 2008. Just when everything seemed ready to go in September, the European Commission objected to one of the tariffs and the whole scheme was stalled.
Rea news winteR 2012
REA News Winter 2012