Last night, Lord Hunt came back with his amendments to the Energy Bill and, as promised, here’s an update. For electricity feed in tariff, he’s proposed:
- Feed in tariff for renewable generation up to a maximum of 3MW (excellent).
- Qualifying technology: biomass, biofuels (oh dear), fuel cells, photovoltaics, water (including waves and tides), wind, solar power, geothermal sources, combined heat and power systems with an electrical capacity of 50 kilowatts or less.
- No timetable for implementation (as far as I could see – is it buried in there somewhere? What will the Baroness say?)
On a heat incentive:
- He’s called it a “renewable heat incentive”, specifically excluding low carbon heat such as heat recovered from power stations or gas CHP. This is symptomatic of the government’s fixation on renewables in the context of the EU targets. Not helpful since many, including local authorities, are looking to the heat incentive to help fund otherwise unviable heat networks.
- Technologies are biomass, biofuels, fuel cells, water (including waves and tides), solar power, geothermal sources, heat from air, water or the ground (oh god, seriously?), combined heat and power systems but only if the system’s source of energy is a renewable source.
- Likely to be funded by the fossil fuel suppliers. Again, how do you come up with an equitable system for sharing out the obligation? Wouldn’t it be better and simpler to socialise the cost via tax?
- May impose a levy on users of fossil fuels for heat (like CCL). So no heat, no levy? That’s can’t be right as it would penalise gas CHP but not pure gas generators.
- Again, no timetable.
I couldn’t find the amendments online (I got them via CHPA) so I’ve posted the FiT amendment on our website along with the renewable heat incentive amendment.
What’s it all mean? Well, in principle it’s fine. However, no timetable means we may never see the incentives come to fruition, especially as it’s likely to take quite a while to agree a means of allocating the cost across energy suppliers. The 3MW threshold is nice and high, so that’s good, and the Secretary of State will be able to set the value of the incentive.
The focus on “renewable heat” is a disappointment. Nice for biomass and solar thermal, and as Nick pointed out, necessary to level the playing field with renewable electricity generation. But it’s too narrow a focus and will only make a limited contribution to our carbon reduction. The sooner they wake up to this, the better chance we have of achieving our targets.
Oh, and what the hell are ground source and air source heat pumps doing in that list?!
As usual, we’ll keep you posted.
carbon limited 
You seem cynical about many parts of the coming Govt incentives and how they apply.
Tend to agree and to my mind if common sense prevailed we would have an electricity tariff structure that went up the more that was used instead of down as happens now!
With an escalator, there is a clear incentive to install eg. Solar PV without any tax or grant or whatever incentive. High users (the wealthy?) can normally afford the capital cost. Low users are on a lower tariff so fuel poverty is addressed.
A reversal of the tariff structure also means there is far more incentive to switch lights off!