Scottish Renewables - the forum for Scotland's renewable energy industry.

 

08/10/2003
Scottish Renewables calls on Ofgem and UK Government to simplify grid charging for renewables in Scotland

Scottish Renewables, the Forum for Scotland’s renewable energy industry, today called for action by Ofgem - the energy regulator - and UK Government to ensure Scottish renewable generators are not penalised by proposed changes to electricity regulations.

The call came in Scottish Renewables’ response to the latest consultation from Ofgem and the Department of Trade and Industry on setting a new set of transmission charges as part of the reform of electricity regulations (known as BETTA – the British Electricity Transmission and Trading Arrangements) due to come into force in April 2005.

Industry is keen to see action by Ofgem to release a consultation on how smaller generators will be affected by BETTA. According to Maf Smith, Development Manager for Scottish Renewables:

“this is a key consultation for renewables, and industry needs to get Ofgem’s views on how the whole BETTA project will encourage and support renewables. The consultation was originally meant to be out in January 2003, but we keep seeing deadlines for release being moved. The consultation is now about 10 months late, and Ofgem can only draw so many lines in the sand before industry starts to ask ‘what have they got to hide?’.

Renewables developers are also concerned by Ofgem-DTI’s proposed model for supporting renewables in Scotland by providing rebates.

Maf Smith notes, “we welcome the fact that Ofgem-DTI are looking at how to balance locational charging with the need to support renewables in peripheral areas like Scotland. However, their proposed model is unworkable, and will lead to regulatory uncertainty in the industry and could frustrate future development of renewables in Scotland. This is bizarre, given that one of the key aims of BETTA is supporting renewables in Scotland.”

Scottish Renewables points out that Ofgem-DTI are proposing to offer rebates on generation in areas of low population density and note in their consultation

“We would see this definition [of peripherality] as wholly inappropriate to smooth running of an electricity system, as peripherality in electricity trading has almost nothing to do with population density, and is therefore a crude lever” says Smith.

Instead Scottish Renewables Forum are calling for Ofgem to set a capped charge that would allow charging to have a locational element but also ensure that peripheral conventional generation should not be penalised. Furthermore, renewables generation should be charged at a capped average Transmission use of system charge.

Maf Smith notes: “This approach would be easier to regulate, is simpler and would ensure that development in Scotland is not stymied. Ofgem’s approach is to introduce a contradictory set of signals, which is akin to putting two sets of traffic lights at a road junction and expecting the traffic to continue flowing smoothly. We need clarity from Ofgem-DTI to ensure that we avoid crashes on the road to developing renewables in Scotland.”

ENDS


Notes for Editors

1. For further information on the issues raised in this press release please contact Maf Smith, Development Manger, Scottish Renewables Forum on 07818 075600.

2. Scottish Renewables Forum is Scotland’s leading renewables organisation. It represents companies working in wind, wave, tidal, solar, hydro and biomass, and aims to create a renewables future for Scotland for the benefit of Scotland’s environment and economy.

3. For a full copy of Scottish Renewables consultation response see http://www.scottishrenewables.com/data/reports/transmission%20charging%20consult%20srf%20response%202-10-03.pdf

4. For information on BETTA see www.ofgem.gov.uk



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