Installer - Regensw
UK Renewable Energy Policy: Latest developments Rachel Solomon Williams Office for Renewable Energy Deployment, DECC 18 June 2013
Context The UK needs to make big changes to the way we generate and use energy The EU Renewable Energy Directive requires the UK to meet 15% of energy demand from renewable sources by 2020 (from 3.8% in 2011) We also need to reduce carbon emissions, keep energy bills down and make sure the lights stay on DECC is leading a transformation of the UK energy system which will see changes in the way we generate electricity, insulate and heat buildings, and power our transport. A big challenge, but also a genuine opportunity which will bring jobs and investment as well as carbon and energy benefits
Making it happen Using less energy
• Green Deal / ECO • Industrial policies e.g. CRC
Greener and more efficient heating
• Renewable Heat Incentive
Low carbon large-scale electricity generation
• Renewables Obligation • Electricity Market Reform
Decentralised electricity generation
• Feed-in Tariffs Scheme
Greener transport
• Renewable Transport Fuels Obligation • Electric vehicles
Green Deal Loft insulation
Creating energy
Windows
Draught proofing
Solid wall insulation
External doors
Heating
Cavity wall insulation
• 45 different improvements can be paid for in part or full • Covers both residential and non-residential buildings
How does the Green Deal work?
Assessment
Assessor gives impartial recommendations on what customers need
Recommendations Quotes Installation Benefits
Provider arranges quotes to customer, provides finance and arranges for installation
Installer installs improvements Customer enjoys benefits and pays provider over time through savings
Extra support: “ECO” Support for
Available to
Solid wall insulation Hard-to-treat cavity wall insulation
Anyone
Easy cavity wall insulation Loft insulation
People living in low income areas (lowest 15%) People on certain income-related benefits in private housing
Heating improvements
People on certain income-related benefits in private housing
• Don’t need to apply separately – should be included when Providers make quotes • Different Providers will have different offers – customers should shop around • Worth around £1.3 billion a year; comes from energy companies (“Energy Company Obligation”)
Cashback Scheme
Some of the main rates Loft Insulation
£100
Cavity wall insulation
£250
Solid wall insulation
£650
Condensing gas boiler
£270
Condensing oil boiler
£310
Single to A rated double glazing
£20/m2 max £320
• Packages could be worth over £1000 – the more work done, the more a householder can get. • Limited offer while funds last. Rates guaranteed for the first £40M. £125M available in total. • Process is exactly like the Green Deal – assessor, provider and installer all involved • So, customers need to get an assessment to start the process.
Full details and apply via gov.uk/greendeal
Non-domestic Renewable Heat Incentive: update The first scheme of its kind to provide support for the installation of renewable heating technologies, opened in November 2011 Tariffs
pence/kWh
Biomass
1.0-8.3
Heat pumps
3.4-4.3
Solar collectors
8.9
Biomethane and biogas combustion
7.1
Next steps - Air quality/metering regulations laid on 10 June; due to come into force by autumn - Domestic RHI; intend to announce details of scheme this summer and open scheme in spring 2014 - Published Government response to the consultation on improving the RHI on 27 February
Domestic RHI: update Proposed in September 2012 consultation that the scheme be open to: Owner-occupiers (second homes would not be eligible) Private landlords (NB: split of support between landlord and tenant based on share of responsibility for heating systems?) Householders who have installed renewable heating since 15 July 2009 with or without government support Also considering bespoke tariffs for the registered social landlord and new build sectors, who face different cost structures and barriers to owner-occupiers Interim support for provided via the Renewable Heat Premium Payment scheme which has delivered for householders and through social landlords and communities (extended to end March 2014, voucher levels increased and social landlords competition launched)
Renewable Heat Premium Payment •
•
•
From 20 May 2013, the RHPP domestic voucher values are: Technology
Old value (£)
New value
Ground source heat pumps
1,250
2,300
Biomass boilers
950
2,000
Air source heat pumps
850
1,300
Solar thermal
300
600
Also from 20 May, new applicants will be required to undertake a Green Deal Assessment before submitting a claim for payment of their voucher. As part of the RHPP 2 extension, we launched a new £6m competition on 2 May. There will be two bidding windows: the first closing on 28 June 2013, with projects to be completed by March 2014; and the second closing on 27 September 2013, with installations to be finished by June 2014.
Renewables Obligation Currently main policy for supporting large scale renewable electricity deployment New bands from 1 April 2014 (subject to state aid approval)
Closes to new generation in 2017 Will be replaced by Contracts for Difference, which will take over as our main source of support for large scale electricity generation projects Between the introduction of CfDs from 2014 and the RO closing in 2017, new renewable energy projects will be able to make a one-off choice between the two mechanisms
Electricity Market Reform Contract for Difference (CfD) Capacity Market
Carbon Price Floor
Early Delivery
• Greater visibility, long term stable cashflows, indexed to inflation • For renewables,15 year fixed revenue contracts paid for energy produced • CCS and nuclear projects also eligible • New long-term contracts for capacity, minded to let first contracts from 2014 • Gas generation eligible
• Long-term certainty of the cost of carbon in the UK • Starts April 2013 • Not just for new nuclear • Transitional CfDs for some renewable and CCS projects • For projects seeking to achieve financial close or make major supply chain commitments this year
Feed-in tariffs: update Over 425,000 installations by end March 2013 Comprehensive review completed during 2012 Greater certainty for industry and generators and reduced impact on consumer bills PV tariff reductions maximum quarterly, depending on take-up AD, wind, hydro and micro-CHP tariff adjustments took effect on 1 December 2012 Further automatic degression for AD, wind and hydro from 1 April 2014 Energy efficiency requirement for building-mounted solar PV (apart from community projects and schools) Pre-accreditation for AD, wind, hydro and community PV
Details on www.ofgem.gov.uk
Connecting new distributed generation to the grid in a timely and affordable way •
DECC expects Distribution Network Operators (DNOs) to provide timely and affordable connection of distributed generation to the grid – vital for meeting national targets and empowering communities to manage their own energy and develop rural economies
•
Ofgem set up the Distributed Generation Forum to identify and overcome barriers to DG connection
•
Various DNO incentive mechanisms for connection / customer service: – Broad Measure of Customer Satisfaction – Guaranteed Standards of Performance – [Proposed for next price control] Time to Connect incentive – [Proposed for next price control] Incentive on Connections Engagement
•
Ofgem introduced competition to the connections market – There are now over 150 Independent Connection Providers
•
Next price control will encourage DNOs to deploy “smart” investment solutions which can provide quicker connections as reinforcement is avoided – Technology development supported by the Low Carbon Networks Fund
www.gov.uk/government/organisations/ department-of-energy-climate-change www.ofgem.gov.uk Twitter.com/deccgovuk
Context The UK needs to make big changes to the way we generate and use energy The EU Renewable Energy Directive requires the UK to meet 15% of energy demand from renewable sources by 2020 (from 3.8% in 2011) We also need to reduce carbon emissions, keep energy bills down and make sure the lights stay on DECC is leading a transformation of the UK energy system which will see changes in the way we generate electricity, insulate and heat buildings, and power our transport. A big challenge, but also a genuine opportunity which will bring jobs and investment as well as carbon and energy benefits
Making it happen Using less energy
• Green Deal / ECO • Industrial policies e.g. CRC
Greener and more efficient heating
• Renewable Heat Incentive
Low carbon large-scale electricity generation
• Renewables Obligation • Electricity Market Reform
Decentralised electricity generation
• Feed-in Tariffs Scheme
Greener transport
• Renewable Transport Fuels Obligation • Electric vehicles
Green Deal Loft insulation
Creating energy
Windows
Draught proofing
Solid wall insulation
External doors
Heating
Cavity wall insulation
• 45 different improvements can be paid for in part or full • Covers both residential and non-residential buildings
How does the Green Deal work?
Assessment
Assessor gives impartial recommendations on what customers need
Recommendations Quotes Installation Benefits
Provider arranges quotes to customer, provides finance and arranges for installation
Installer installs improvements Customer enjoys benefits and pays provider over time through savings
Extra support: “ECO” Support for
Available to
Solid wall insulation Hard-to-treat cavity wall insulation
Anyone
Easy cavity wall insulation Loft insulation
People living in low income areas (lowest 15%) People on certain income-related benefits in private housing
Heating improvements
People on certain income-related benefits in private housing
• Don’t need to apply separately – should be included when Providers make quotes • Different Providers will have different offers – customers should shop around • Worth around £1.3 billion a year; comes from energy companies (“Energy Company Obligation”)
Cashback Scheme
Some of the main rates Loft Insulation
£100
Cavity wall insulation
£250
Solid wall insulation
£650
Condensing gas boiler
£270
Condensing oil boiler
£310
Single to A rated double glazing
£20/m2 max £320
• Packages could be worth over £1000 – the more work done, the more a householder can get. • Limited offer while funds last. Rates guaranteed for the first £40M. £125M available in total. • Process is exactly like the Green Deal – assessor, provider and installer all involved • So, customers need to get an assessment to start the process.
Full details and apply via gov.uk/greendeal
Non-domestic Renewable Heat Incentive: update The first scheme of its kind to provide support for the installation of renewable heating technologies, opened in November 2011 Tariffs
pence/kWh
Biomass
1.0-8.3
Heat pumps
3.4-4.3
Solar collectors
8.9
Biomethane and biogas combustion
7.1
Next steps - Air quality/metering regulations laid on 10 June; due to come into force by autumn - Domestic RHI; intend to announce details of scheme this summer and open scheme in spring 2014 - Published Government response to the consultation on improving the RHI on 27 February
Domestic RHI: update Proposed in September 2012 consultation that the scheme be open to: Owner-occupiers (second homes would not be eligible) Private landlords (NB: split of support between landlord and tenant based on share of responsibility for heating systems?) Householders who have installed renewable heating since 15 July 2009 with or without government support Also considering bespoke tariffs for the registered social landlord and new build sectors, who face different cost structures and barriers to owner-occupiers Interim support for provided via the Renewable Heat Premium Payment scheme which has delivered for householders and through social landlords and communities (extended to end March 2014, voucher levels increased and social landlords competition launched)
Renewable Heat Premium Payment •
•
•
From 20 May 2013, the RHPP domestic voucher values are: Technology
Old value (£)
New value
Ground source heat pumps
1,250
2,300
Biomass boilers
950
2,000
Air source heat pumps
850
1,300
Solar thermal
300
600
Also from 20 May, new applicants will be required to undertake a Green Deal Assessment before submitting a claim for payment of their voucher. As part of the RHPP 2 extension, we launched a new £6m competition on 2 May. There will be two bidding windows: the first closing on 28 June 2013, with projects to be completed by March 2014; and the second closing on 27 September 2013, with installations to be finished by June 2014.
Renewables Obligation Currently main policy for supporting large scale renewable electricity deployment New bands from 1 April 2014 (subject to state aid approval)
Closes to new generation in 2017 Will be replaced by Contracts for Difference, which will take over as our main source of support for large scale electricity generation projects Between the introduction of CfDs from 2014 and the RO closing in 2017, new renewable energy projects will be able to make a one-off choice between the two mechanisms
Electricity Market Reform Contract for Difference (CfD) Capacity Market
Carbon Price Floor
Early Delivery
• Greater visibility, long term stable cashflows, indexed to inflation • For renewables,15 year fixed revenue contracts paid for energy produced • CCS and nuclear projects also eligible • New long-term contracts for capacity, minded to let first contracts from 2014 • Gas generation eligible
• Long-term certainty of the cost of carbon in the UK • Starts April 2013 • Not just for new nuclear • Transitional CfDs for some renewable and CCS projects • For projects seeking to achieve financial close or make major supply chain commitments this year
Feed-in tariffs: update Over 425,000 installations by end March 2013 Comprehensive review completed during 2012 Greater certainty for industry and generators and reduced impact on consumer bills PV tariff reductions maximum quarterly, depending on take-up AD, wind, hydro and micro-CHP tariff adjustments took effect on 1 December 2012 Further automatic degression for AD, wind and hydro from 1 April 2014 Energy efficiency requirement for building-mounted solar PV (apart from community projects and schools) Pre-accreditation for AD, wind, hydro and community PV
Details on www.ofgem.gov.uk
Connecting new distributed generation to the grid in a timely and affordable way •
DECC expects Distribution Network Operators (DNOs) to provide timely and affordable connection of distributed generation to the grid – vital for meeting national targets and empowering communities to manage their own energy and develop rural economies
•
Ofgem set up the Distributed Generation Forum to identify and overcome barriers to DG connection
•
Various DNO incentive mechanisms for connection / customer service: – Broad Measure of Customer Satisfaction – Guaranteed Standards of Performance – [Proposed for next price control] Time to Connect incentive – [Proposed for next price control] Incentive on Connections Engagement
•
Ofgem introduced competition to the connections market – There are now over 150 Independent Connection Providers
•
Next price control will encourage DNOs to deploy “smart” investment solutions which can provide quicker connections as reinforcement is avoided – Technology development supported by the Low Carbon Networks Fund
www.gov.uk/government/organisations/ department-of-energy-climate-change www.ofgem.gov.uk Twitter.com/deccgovuk
