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DECC to review its policy on grandfathering for biomass

The government has said it will look again at its support for biomass electricity under the Renewables Obligation following significant concerns about investment.

As reported in MRW, the renewable energy industry has expressed worry over the absence of the grandfathering principle for Renewable Obligation Certificates in relation to biomass facilities.

Without grandfathering financiers are reluctant to put any funding into biomass projects in case the ROC banding goes down rendering them no longer economically viable.

As a result of these concerns many proposed biomass facilities have been unable to go ahead, leaving the future of the industry in doubt.

The Renewable Energy Association has been working with the Department for Energy and Climate Change to try and resolve this issue and earlier this week the government issued a statement in both the House of Commons and Lords outlining what it intends to do.

I am aware that our current policy not to grandfather the support given for biomass electricity under the Renewables Obligation has caused significant investment concerns within the industry, said Minister of State for Energy and Climate Change, Lord Hunt.

Given the risk that investment will not come forward, DECC will review the policy on grandfathering and prepare a statement before the end of March.

Responding to the statement REA director of policy Gaynor Hartnell said: We welcome Governments clear desire to resolve the hiatus in financing of biomass and bioenergy projects as swiftly as it can.

We recognise that the process for changing the Renewables Obligation legislation is very restrictive, precisely in order to give investors confidence. 

One consequence of this is that when a change needs to be made swiftly (in this case for the benefit of investors confidence) it cannot be done immediately. 

We therefore look forward to the planned statement before the end of March.


 

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