Climate change minister Greg Barker has announced a review of Feed-in-Tariff (FIT) subsidies for small-scale anaerobic digestion (AD) plants.
In a letter to the industry, Barker said the Department for Energy and Climate Change (DECC) would consult in January to ensure that smaller AD plants were not “unfairly disadvantaged” by an anticipated degression, which is a fixed annual percentage reduction in tariffs.
The capacity trigger for AD plants under 500kW was reached in September. Under current policy, this will cause a 20% degression in FITs for all new-build plants under 500kW from April 2014.
The Renewable Energy Association (REA), the Anaerobic Digestion and Biogas Association (ADBA) and other interested organisations had called for an urgent review of the degression, fearing the current arrangements would make small-scale AD, such as those on farms, economically unviable.
Charlotte Morton, chief executive, ADBA welcomed the minister’s response: “Barker has taken the opportunity to correct flaws in the FIT mechanism and save a hugely important sector from disaster.
“Smaller scale AD has a huge amount to offer - using slurry and farm wastes mitigates methane emissions on farms, generating employment in rural communities and creating a UK manufacturing sector with strong export potential.”
REA chief executive Dr Nina Skorupska said: “It is very encouraging ahead of the Autumn Statement to see ministers and officials really listening and responding to industry concerns.
“If this situation isn’t resolved, the on-farm AD industry will grind to a halt. The timely announcement of the review gives Government a good chance of fixing the situation quickly enough to preserve the majority of existing projects and keep the door open for further growth.”
- This week Barker also reaffirmed the Government’s commitment to renewable heat and combined heat and power (CHP)