Clean Energy & Sustainability E-briefing: UK DECC launch consultation on sustainability and affordability of biomass generators under the Renewables Obligation “RO”

    • Energy and Natural Resources

    12-09-2012

    In line with DECC’s response to the consultation on banding levels in July, DECC has launched on 7 September 2012 its consultation on sustainability and caps for biomass feedstock generators.

    Key points of the consultation

    Sustainability criteria

    DECC propose that:

    • Biomass and biogas facilities of 1MWe should be required to meet the sustainability criteria as a prerequisite to receiving support under the RO from October 2013.
    • Sustainable forestry management criteria, being:
      • for solid-wood fuel the UK Government's public procurement policy for wood
      • for perennial energy crops the Energy Crop Scheme or equivalent and
      • for solid biomass or biogas, the RED land criteria.
    • The following GHG lifecycle criteria:
      • new dedicated biomass (accredited after April 2013) at 240kg CO2eq per MWh between 2013 and 2020 (reducing to 200kg CO2eq per MWh between 2020 and 2025)
      • existing dedicated biomass (accredited before April 2013) at 285.12kg CO2eq between 2013 and 2020 (reducing to 200kg CO2eq per MWh between 2020 and 2025)
      • coal plant converting to or co-firing with biomass at 285.12kg CO2eq per MWh (reducing to 240kg per MWh between 2020 and 2025)
    The 2020 to 2025 figures are very much preliminary.
    • Reporting and auditing requirements are improved and clarified for all facilities over 50kW (except for waste and bioliquids) covering form of biomass, volume, origin, format.
    • There be limited grandfathering in respect of such sustainability criteria, namely, they will remain fixed until 2020, subject to any changes in EU or international requirements.
    • In addition, a sustainability audit report from an independent verifier, will be required for all stations of 1MW above.

    The intention is that the above (except for profiling criteria) do not apply to biomass wholly derived from waste, landfill or sewage gas, manure or animal slurry. Profiling criteria shall not apply to msw, landfill and sewage gas.

    Caps and bands

    DECC propose:

    • A cap on the percentage of ROCs that each supplier can access for new  dedicated biomass power (excluding bioliquids and CHP) accredited after 1 April 2013. DECC is proposing that the caps are set at the following levels:

    Obligation Period

    Maximum % of suppliers obligation using new dedicated biomass ROCs

    2013/14

    19%

    2014/15

    17%

    2015/16

    14%

    2016/17

    12%


    • Reducing support for standard co-firing (i.e. combustion of less than 50%  biomass) to 0.3 ROCs/MWh for 2013/14 and 2014/15.
    • Co-firing of regular bioliquids will also see support fall in line with the proposed reduction for standard co-firing i.e. reducing to 0.3 ROCs/MWh for 2013/14 and 2014/15 and increasing to 0.5 ROCS/MWh from 2015/16.
    • Reducing the support for co-firing with CHP to 0.8 ROCs/MWh for 2013/14 and 2014/15 or 0.3 ROCs/MWh plus the RHI. The standard co-firing with CHP band is intended to be closed to new entrants from 2015.
    • Removing the energy crop uplift, of 0.5 ROCs, for standard co-firing to ensure affordability. DECC propose that the current up-lift should end on April 2013 except for generators who, before 7 September 2012, have contracts in place for the supply of energy crops for co-firing - these generators can continue to claim the 0.5 ROC uplift until 31 March 2019.

    The closing date for responses for:

    Sustainability is 30 November 2012.

    Caps and bands is 19 October 2012.

    To read the full consultation, please click here.

    For further information on this article, please contact:

    Michelle T Davies
    Head of Clean Energy & Sustainability
    Partner

    Tel: 0845 498 7553
    Int'l: +44 292 047 7553
    michelletdavies@eversheds.com

    Jean-Pascal Boutin
    Partner
    Tel: 0845 498 8265
    Int'l: +44 292 047 8265
    jean-pascalboutin@eversheds.com

    Disclaimer

    This information is for guidance purposes only and should not be regarded as a substitute for taking legal advice. Please refer to the full terms and conditions on our website.

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