U.K. Government Promises Better Marketing for Renewables

In addition to encouraging more local generation of energy by making grid connection easier, the British government has agreed to examine ways to ensure that the New Electricity Trading Arrangements do not place penalties on renewable power sources, particularly wind energy.

LONDON, England, UK, 2001-11-14 [SolarAccess.com] Energy minister Brian Wilson has conceded that there are problems for both wind energy and combined heat & power (cogeneration) suppliers. “We want to help to stimulate the renewables market and, if there are perceptions and realities standing in the way of that, then I share the wish to remove them,” he says. The British Wind Energy Association says the impact of NETA has distinct disadvantages for non-firm generation, notably wind, where the less-predictable output places high financial risks on wind generation. Uncertainty about generation puts generators in danger of paying punitive charges which, in turn, make investment in wind capacity unattractive. Under deregulation, Wilson says NETA has delivered “spectacular results,” with wholesale electricity prices down 25 percent. Price reductions for renewables have been more modest, at 17 percent, and Wilson says he soon will publish proposals for consultation aimed at addressing the concerns of smaller generators. BWEA says minor tweaks to NETA have been made but, to date, are “incompatible” with the intention of bringing 10 percent of renewables into the supply mix. Without further support in the form of capital grants or a renewables ‘sub-obligation’, the wind group says it is difficult to see how Britain will develop offshore wind generation without considerable delay, while other cheaper resources are exhausted. “Even the welcome exemption of renewables from the Climate Change Levy is not certain to ameliorate the impact of making wind projects bankable,” it says. “Without a predictable growth and market for wind in the UK, it is extremely unlikely that manufacturing (or assembly) of wind turbines will occur domestically.” “This is ironic, because the UK represents potentially the most attractive opportunity for manufacturing in Europe, with a skilled labour force, lower labour costs, the most deregulated market, an emerging green market, good onshore and offshore transportation links and, of course, an enormous indigenous resource,” it adds. The House of Lords recently warned of a four-fold increase in the rate of deployment that will be necessary before government targets of 10 percent from renewables could be achieved. “No-one believes that Government is on target to achieve its own 5 percent target by 2003,” says BWEA. “This is more than just a risk of loss of face for government. Failure to achieve 10 percent may have implications for the post-Kyoto 20 percent CO2 abatement manifesto targets and, of course, severely limit the potential for economic development growth in the UK.”
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