The Government today gave the go-ahead for a large expansion in bioenergy power projects across the UK. The announcement by Chris Huhne, the Secretary of State at the Department of Energy and Climate Change, removes a key obstacle to financing projects by guaranteeing levels of support under the Renewables Obligation for 20 years after completion.

Projects fuelled by wood and wastes have a crucial role in helping the UK meet its renewable energy targets.  There are currently over 5,000 megawatts of dedicated biomass, energy from waste, gasification, pyrolysis and biogas that have been stalled in the development process. They range from 300 megawatt plants (able to meet the annual needs of a population the size of Liverpool) to biogas plants on farms, which could together provide distributed energy right across the UK.  

The output from these projects would be equivalent to around 13,000 megawatts of onshore wind.

Gaynor Hartnell, Chief Executive of the REA said

“Today’s announcement will come as a great relief and follows many months of intense discussions between the industry and Government. This brings most bioenergy projects into line with other technologies such as wind. Levels of financial support (ROCs) for completed projects are now guaranteed for 20 years, even if the rules change in the future. This should unlock some £13billion of much-needed private investment in the sector. For this to happen, lenders must have confidence in the support mechanism. This had been lacking, but today’s announcement gives clarity.

“As well as generating baseload power, these projects bring many other benefits.  They can help with waste management objectives, improve fuel security, create jobs and help with rural diversification.   There is also great scope for innovation, as some of these technologies are cutting edge.“

There is a small but significant sector of the bioenergy industry which has not yet been assured of grandfathering, however.  The Department of Energy and Climate Change has signalled that it needs more time to evaluate whether to extend the same guarantees to electricity generation from liquid fuels.

“These fuels should not be discriminated against,” says Hartnell.  “These projects can be among the most environmentally friendly and innovative of all.  They also have the strongest sustainability regulation - liquid fuels for power will have to meet tough new standards on environmental protection from next year.”

See the DECC press release.

See the EU Renewable Energy Directive.