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Media Releases
2007

23 May
2007

Response to energy white paper

The Government's long-awaited Energy White Paper has set out a wide range of proposals affecting the future prosperity of the UK. With First Minister Alex Salmond's recent pronouncements on nuclear generation it is likely that renewables development will continue to be a key area of focus for Scotland.

The White Paper sets out a number of proposals aimed at improving the financial incentives to development and removing or lowering some of the practical barriers currently faced by renewables developers in the UK.

The introduction of banding to the renewables obligation has been trailed for some time and was causing considerable uncertainty to the economics of financing large-scale onshore wind projects in the UK.

The White Paper's proposals address many of the concerns of the onshore windfarm community regarding the value of ROCs by retaining a 1:1 ratio between ROCs and Megawatts generated although the overall impact of the proposals on the value of ROCs remains to be seen.

A major source of concern for the renewables developer at present in Scotland is the delays and costs associated with connection to the grid. The White Paper suggests that the DTI will continue to work with NGET and the industry via existing governance mechanisms to allow earlier access to the grid.

In this area, the White Paper is clearly welcome but falls some way short from the considered and detailed proposals also launched today by the Scottish Renewables Forum in its Making Connections document.

That document suggests that material changes are needed both to the remit of OFGEM and the governance mechanisms surrounding the industry codes if real progress is to be achieved.

Liz McRobb, partner in the Energy Team of Shepherd and Wedderburn, said: "The White Paper will take detailed review. Its proposals on renewables in relation to planning and banding appear helpful but the critical grid access issues have not been tackled head on and there is currently a real lack of momentum behind various initiatives in this area. In this respect, the White Paper is a missed opportunity to set out a real agenda for change."


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