Specialist MPs have said the UK will not meet its renewable energy targets and have called on the Government to protect biomass and biomethane subsidies.
A report by the Energy and Climate Change Select Committee said the UK would fail to reach legally binding targets of providing 15% of its energy needs from renewable sources by 2020 because of “underperformance” in heat and transport.
It criticised the handling of the Renewable Heat Incentive (RHI) subsidy scheme, which is facing an overall spending cap of £430m in 2015-16, rising to £1.15bn in 2020-21, under proposals put forward earlier this year.
The Government also proposes that support will be targeted at large biomass boilers.
Nearly 93% of installations under the non-domestic RHI scheme are biomass boilers. The committee said there was a “strong case” for biomass support levels to be retained at their current levels.
It added: “If the Government confirms the proposed changes for biomass in the RHI, it must consider what support needs to be given to the supply chain for it to adapt at sufficient speed.”
Biomethane gas-to-grid subsidies under RHI have also been cut back in recent years.
The report said: “Above all, biomethane is crucial to meeting the 2020 target and must remain a funding priority. The Government should revise its RHI reforms to reflect these priorities, especially in protecting biomethane support.”
The report follows an inquiry that heard evidence from a wide range of industry experts, including the Renewable Energy Association (REA) and the Anaerobic Digestion & Bioresources Association.
Its chief executive Charlotte Morton said: “The biomethane industry is ready to deliver, but needs policy certainty on the RHI and the renewable transport fuels obligation for developers and investors to move forward with new projects.”
REA chief executive Nina Skorupska said: “In the past week, the US and China, the world’s two largest economies, formally committed to long-term decarbonisation by signing the Paris Climate Agreement.
“The scale of low-carbon investment that we can expect in the coming decades is in the trillions of dollars globally. It is therefore critical, as this report highlights, that renewables and decarbonisation are at the heart of the Government’s future industrial strategy.”
The committee also concluded that the Government’s overall renewables strategy has been “hampered by inconsistent approaches”.
It said: “The creation of a new Department for Business, Energy and Industrial Strategy is an opportunity for greater co-operation and consistency. The new Economy and Industrial Strategy Cabinet Committee should place meeting the UK’s renewables and decarbonisation targets at the heart of its terms of reference.”