Trade associations have welcomed the Government’s announcement that renewables generators, especially biomass and Energy from Waste (EfW), could benefit from £25m-worth of investment.
Under a ‘Energy for Growth’ pilot programme set to start in the New Year, the Government Procurement Service (GPS) - the biggest buyer of energy in the UK - will open up 2% of its demand to renewable generators.
Charlotte Morton, chief executive for the Anaerobic Digestion and Biogas Association, welcomed the investment opportunity but warned that the techonology used to generate energy should be as sustainable as possible. This means in terms of CO2 emissions, as per the Climate Change Committee recommendation of 50g/CO2 per kWh, and also in terms of the best use of resource - for instance, anaerobic digestion was recognised in the Waste Review as the best treatment option for food waste.
Morton said: “There is no one solution to the UK’s future energy mix, but technologies like biogas from anaerobic digestion, which generate flexible ultra-low carbon energy constantly, have particular value. Biogas is flexible and can decarbonise difficult areas including transport and the gas-grid – or generate green electricity and heat.”
The Renewable Energy Association chief executive Gaynor Hartnell said “This is an excellent initiative.The first phase is to sign around 75MW of non-intermittent renewable energy projects – and expand later into wind and solar.”
Hartnell added that the GPS would be in a good position to inform Government if any renewables policies were not helpful from a business perspective.
The contracts will be for a proportion of the generators’ capacity for up to 25 years and it is estimated the pilot will save £155m over 15 years by promising a good price for renewable energy in return for financial security to attract investment.
The Cabinet Office said at least 150 projects were currently stalled and needed investment to get off the ground.
Depending on the success of the pilot, the GPS could diversify up to half of its annual £750m portfolio with renewables over the next five years.