Wind industry gives thumbs-up to Budget package

by Michael Smith (Veshengro)

UK renewables industry leaders have welcomed Alistair Darling’s Budget announcement of a package of measures to build a low carbon economy and further decarbonise electricity generation. The proposals include a potential GBP 525m of new money through a review of the support mechanism for offshore wind. The Chancellor also announced a new deal with the European Investment Bank to provide a package of up to GBP 4 billion for investment in renewable infrastructure projects, as well as a one year across the board doubling of capital allowances from 20% to 40%.

Adam Bruce, Chairman of the British Wind Energy Association BWEA, said: “This package of measures deserves a welcome from our industry, and is in line with proposals that we have been working through with government. It addresses the short-term economic hurdles we faced due to the fall of the Pound against the Euro, and the post-Lehman collapse in project finance.

It also restates the Government’s long-term commitment to the renewable energy sector, and should enable us to unlock up to GBP 10bn of private sector investment in wind and marine energy projects over the coming few years.”

The Budget proposes to review the support given to the offshore wind from Renewables Obligation Certificates by GBP 525m. Electricity supply companies currently receive 1.5 ROCs for every megawatt hour (MWh) of energy they buy from offshore wind farms, which they can then sell on. Under the Chancellor’s plans this will rise to 2 ROCs for the financial year 2009-2010, and fall back to 1.75 ROCS in 2010-11.

Because of the collapse in bank lending wind schemes currently seeking finance face potential delays, particularly those being developed by independent power companies that have historically relied on project finance to bring wind farms into operation. Under the arrangement negotiated by the Chancellor the European Investment Bank will make available up to GBP 4 billion for UK renewable schemes which cannot find project finance.

Richard Mardon, Managing Director of Your Energy Ltd, a leading UK independent onshore wind energy developer said: “The UK has 9GW of wind energy projects on and offshore with planning consent or in construction, as much as 5GW of which could be completed within the next 2-3 years. Sorting out funding issues at this stage is crucial if we are to make a decisive step towards reaching our 2020 targets on renewable energy.”

Today also saw the announcement of GBP405 million in funding for other low carbon energy technologies, including wave and tidal devices - a sector where the UK is currently a world leader in research and development. The new funding will come via existing programmes such as the Environmental Transformation Fund to assist manufacturers to taking their projects from prototype to the commercial stage.

Alan Moore, the Chair of the Government’s Renewables Advisory Board and outgoing Chair of BWEA’s Marine Strategy Group said: “The GBP 405m for low carbon technologies development and deployment is a very promising and much needed budget decision. The wave and tidal industry has been fighting for support over the past years and only through determined efforts has made steady progress and established the UK as the world leader in this field. With this boost we should see the UK speeding the progress towards exploiting our massive indigenous wave and tidal energy potential.”

However, we must also consider that coal has also been given the go-ahead with some new power stations to be built.

While there is so-called clean coal technology supposedly about clean and coal do not really appear two words that can be mentioned in the same breath.

On the other hand this could be good for the home coal industry and might, just might, get the pits re-opened. Estimates from other than the Coal Board then who were hell bent on shutting the collieries so cheap coal could be brought in from Poland and such claimed then that we would have coal reserves that would last for centuries and more.

But, we must, and other issues could detract, concentrate on creating carbon-neutral sources of energy. Wood burning power stations might be an idea, for the only carbon that is released by burning wood is that that the tree stored during its growth. Coal fired stations could be used for that.

Otherwise, however, we must look to wind and wave in Britain for some of our needs. I say some for it is doubtful that all of them, at the current rate of the technology, could be met from those sources.

Solar voltaic is not, I believe, a real viable option in the UK, while solar heating devices on roof could, would and do work well. The sun just is not good enough and the panes not good enough – whichever way you may like to see this – for reliable power generation in our region of the hemisphere.

Small wind power too must be permitted by the government on individual homes and even apartment blocks for individual flats, regardless of whether or not someone may not see them as aesthetically pleasing. It is our Planet that should concern us more and our future than where a windmill at a house or a solar panel of whatever kind on the roof, etc. might “change the character of the building” or of an area.

© 2009