REGOs: The need for a new renewable energy certificate of origin

Image: Getty

BLOGS SUPPLY

Image: Getty

There is a problem with green electricity. The current system of accounting for the provenance of green electricity does not reflect the benefit that consumers expect. The Renewable Energy Guarantees of Origin (REGO) certificate was developed to meet an EU requirement for all member states to be able to record and report what proportion of electricity consumption was from renewable sources and are issued at a rate of 1 REGO per MWh (Megawatt hour) of electricity generated.

Suppliers use the REGO to calculate their Fuel Mix Disclosure, which is what consumers and customers of suppliers are shown to demonstrate how “green” a tariff or company is. REGOs can only be used once to demonstrate that a unit of electricity is from a particular renewable energy source.

But, they can be bought and sold separately from the actual unit of electricity that came from the renewable generator. Because of this the price suppliers pay for REGOs is based on a simple supply/demand economic, and because there is currently sufficient renewable generation capacity to meet demand, that price is low at c. 30p-50p per certificate which equates to only around 1% of the wholesale cost of electricity. In addition, almost all this renewable capacity is subsidised generation – so is already being paid for through consumer bills.

These economic conditions mean that unfortunately this system does nothing to support new, unsubsidised, renewable generation, and nothing to cut carbon emissions.

Critics of the system see REGOs as a loophole that allows suppliers to become seemingly “green” overnight for a rock bottom price, without actually forming relationships directly with renewable generators.

This is true, but doesn’t get to the crux of the problem, which is that buying power from old, subsidised renewable generation is currently treated the same as that from new, unsubsidised renewable developments. This is key because we need about 3GW of new renewable generation capacity annually if we are to achieve our 2050 net-zero target and work towards averting a catastrophic climate breakdown. This means that REGOs from subsidised generation are not truly green as they do not incentivise the build of new renewable developments – known as additionality.

Change is needed, and needed fast, to enable us to meet the net-zero 2050 target. We need a sustainable market to deliver the sort of consistent increase in renewable capacity, and that means a move away from subsidy towards market-based mechanisms.

One simple resolution would be to introduce a new certificate that is only for new, unsubsidised renewables – let’s call it the Green Renewable Energy Endorsement certificate (GREEn). The GREEn would place new value on additionality, by allowing suppliers to distinguish between old and new renewable generation. Suppliers will be able to launch “additional” tariffs allowing consumers to buy a product that truly supports the fight against catastrophic climate change.

One immediate challenge will be educating consumers about the difference between a REGO backed green tariff, and a “new GREEn” tariff as at the moment many people believe that by buying power from a “green” electricity supplier, or a “green” tariff is enough, so communicating the importance of new generation will be key. As a nation we’re on the right track on that front, general awareness of climate change is on the rise and has increased by over 75% from Q1 of 2018 to Q1 of 2019¹.

This awareness has driven new UK Government policies, such as the 2050 net-zero carbon target, but more must be done to educate consumers about the plan to hit that target. Decarbonising the electricity sector is a relatively easy and quick win – and one that leads to lower long-term power pricing. Once consumer demand for additional tariffs grows suppliers would be incentivised to launch longer term GREEn Purchase Agreements (GPAs) with developers, owners and operators of new generation and the price of GREEns would rise, helping to finance the delivery of new subsidy-free renewable generation, and recognising the part it is playing in reducing carbon emissions.

As the market for REGOs has transformed, now is the time for Ofgem and BEIS to reassess new ways to provide the most support to renewables in the subsidy-free market context. It is clear that decarbonising the UK’s energy industry and building new cost-effective renewables will be key if we are to meet our 2050 net-zero target.

GREEns have the potential to be the key that unlocks this new unsubsidised clean energy capacity and make electricity more affordable for all in the long term.

Note: ¹ Information taken from Google Trends.


UK Wholesale Power Prices since the Millenium

by Dr Iain Staffell - Imperial College London

Power prices have risen by 50% in the last year due to the rising cost of gas and carbon emissions, and uncertainty around Brexit weakening the pound. Electricity on the day-ahead market averaged £60/MWh over the quarter, up from £42/MWh this time last year. Rather than seeing extreme price spikes as in previous years or during specific events such as the Beast from the East, day-in day-out baseload prices have been creeping up as the year progresses. Consumers may see price rises going into the winter, giving the opportunity to switch to a cheaper, and greener, tariff.

Electricity generators are facing sustained pressure on three fronts: the cost of natural gas has been climbing since August, the price paid for emitting CO2 emissions has risen throughout the year, and the pound remains weak against foreign currencies.

Gas prices have risen 50% since June. The growth of liquified natural gas (now 9% of Britain’s gas supply) has globalised the gas market, and so soaring demand from China pushes up gas prices at home. This is especially important as gas power stations exert six times more influence in setting the price of power than any other technology in Britain. Gas stations are more dominant in Britain than in other European markets, and more dominant now than ever before, as they are the primary source of flexible capacity.

Secondly, the price of emitting CO2 on the European Emissions Trading Scheme (ETS) has quadrupled in the past 12 months. This comes after many years of hovering around €5 per tonne as many governments had issued so many permits to pollute that the market was flooded.

Thirdly, energy is an international commodity. Gas prices are linked to oil (traded in US dollars), carbon permits are priced in Euros, and even domestically produced fuels (now just 44% of the UK’s gas) can be exported easily, so their value is determined internationally. This matters because the pound fell against the Euro and Dollar since the EU referendum. Analysis for Ofgem shows that the Brexit vote caused an 18% increase in electricity prices, primarily because of the currency devaluation.

Little can be done about international fuel prices. Weakening Britain’s carbon price support could make electricity cheaper, especially from coal-fired stations. But the six remaining coal stations have little ability to set power prices, so price reductions would be muted while the cost of gas remains high. A longer-term strategy would be to further diversify into other energy sources, particularly renewables which can lock-in long term fixed prices and break free from the volatility of fossil-fuel markets.

Average wholesale electricity price each quarter since the electricity spot market was created in 2001 alt

Authors: Dr Iain StaffellProfessor Richard GreenDr Rob GrossDr Malte Jansen, and Professor Tim Green.


Citizens Advice: Government lacking 'credible' plan to decarbonise heat

12 July 2019, source edie newsroom

The Government's failure to implement a "credible" framework for the decarbonisation of heat for commercial and domestic use could undermine public confidence in the net-zero transition, Citizens Advice has warned.

The UK's heat networks currently serve about 500,000 customers, but this could rise to five million by mid-century 

The UK's heat networks currently serve about 500,000 customers, but this could rise to five million by mid-century

In a letter to Ministers today, the charity criticises the Government for leaving “large gaps” in policies surrounding the regulation of low-carbon technologies like heat networks.

The Committee on Climate Change (CCC) has consistently claimed that heat networks could deliver up to 18% of UK heating demand by 2030. Taking notice of this, the Government has recently launched a £320m scheme to help accelerate the adoption of low-carbon heat networks across the UK's public, private and domestic sectors and an Energy Systems Catapult centre to assist small and medium-sized businesses (SMEs) with decarbonising their heat systems.

While welcoming this progress, Citizens Advice is arguing that policy is not currently sufficient to protect consumers during the decarbonisation of heat and is likely to result in customer confusion, infrequent and inaccurate billing, and, therefore, overpayment. The charity is voicing concerns that, as most of the costs related to the decarbonisation of the energy system are currently paid for through energy bills, those on low incomes could end up paying a disproportionate share of that cost.

The organisation’s key recommendation for preventing this is the establishment of an independent commission on a “just” transition to low-carbon energy, including heat. It is additionally calling for a consultation on the Government’s upcoming Energy White Paper, to be made open to industry and the general public, as well as legislation to extend Ofgem’s regulation powers to cover heat networks.

Citizens Advice’s chief executive Gillian Guy has claimed that these moves need to be undertaken as soon as possible “to prevent the bad practice of today becoming the standard practice of tomorrow”.

“The way we heat our homes needs to undergo a major transformation, and how we manage that process and fairly distribute the costs needs the urgent attention of Government,” Guy said.

“An independent commission is the only way to make sure the pathway to net-zero is assessed in a rigorous, transparent and timely way.”

Industry progress

The UK currently plays host to around 14,000 heat networks, which collectively serve more than half a million customers – both business and domestic.

However, much more will need to be done in this space if the UK is going to meet its new 2050 target of a net-zero carbon economy, the CCC has claimed. Heating and hot water account for around 15% of the UK's overall carbon footprint, with the nation currently off-track to meet a key target of ensuring 12% of heat is generated using renewables by 2020.

Responding to Citizens Advice’s report, the Association of Decentralised Energy’s (ADE) head of operations Lily Frencham said: “Citizens Advice are right that there is a need for a credible plan from the Government, working with industry and other key interests, to decarbonise heat if net-zero is to be delivered.

“The building of more heat networks is widely acknowledged to be a key component to any future plans. They are key in urban areas, allowing towns and cities up to capture otherwise wasted heat and deliver it to homes and offices driving down emissions.  Appropriate regulation of heat networks is necessary, to provide customers with confidence and protection around issues such as billing, while giving businesses and local authorities confidence to make the necessary investment in the new heat networks that will be needed.”


A Pathway To 350 PPM Part 1: Carbon Sequestration Is Vital

July 12th, 2019 by  Ryan Logtenberg is a director of the 2 Degrees Institute.


Humans are responsible for emitting around ​55 billion tonnes of CO​2e​q/year​, with 2⁄3 of the emissions coming from the burning of fossil carbon. Currently, there are ​414 PPM​ of CO​2​ in the atmosphere, and it’s rising at just over 2 PPM per year. Even if we were to completely stop burning fossil carbon, we would still see an increase in the amount of greenhouse gases (GHGs) entering the atmosphere, largely from agriculture and potentially from ​positive feedback loops​ triggered by a hotter world.

Global greenhouse gas emissions per type of gas & source

Source: PBL Netherlands Environmental Assessment Agency, EDGAR v5.0/v4.3.2 FT 2017 (EC-JRC/Pbl, 2018); Houghton and Nassikas (2017)

Positive feedback loops are arguably the most frightening aspect of climate change because they lead to a phenomenon known as “runaway global warming,” a condition in which the warming planet releases trapped greenhouse gases, causing it to warm even faster, regardless of human intervention. One positive feedback loop that gets a lot of attention is the warming of the arctic permafrost. As the arctic tundra melts, methane, a powerful trapped greenhouse gas is released, which leads to more warming, which, in turn, leads to more methane being released, and so on. Some other examples of positive feedback loops include the melting of the ​polar ice cap​, droughts causing ​forests to burn​ and release more CO​2, a​nd warming oceans causing the gasification of ​methane hydrates​ on the seafloor. Scientists have theorized that the gasification of methane hydrates could have been the cause of the greatest extinction event to have occurred on earth known as the “Great Dying” or the ​Permian–Triassic Extinction Event​.

Photo shows permafrost thaw ponds on peatland on the shores of Hudson Bay, Canada. Photo ​by ​Steve Jurvetson

According to a paper by ​Hansen et al​., a safe level of atmospheric CO​2​ to avert runaway global warming is below 350 PPM. Before our discovery and use of fossil carbon, pre-industrial CO​2 levels hovered around ​280 PPM​. So we have our work seriously cut out for us not only to reduce our emissions, but remove (sequester) GHGs from the atmosphere.

Different types of GHGs naturally remain in the atmosphere for different lengths of time. The three most abundant human caused greenhouse gases are nitrous oxide, methane, and carbon dioxide.

Nitrous oxide​ (N​2O​ ) is the third most abundant greenhouse gas and represents 6.2% of human caused greenhouse gas (anthropogenic) emissions. N​2O​ will persist in the atmosphere for about 114 years before being naturally dismantled by chemical reactions in the stratosphere.

Methane​ is second on the list, representing 16% of total anthropogenic emissions. When looking at the global warming potential averaged over a ​20-year time scale​ as opposed to the standard 100-year, methane represents 1⁄3 of anthropogenic emissions, making it a much more serious greenhouse gas in the short term. Methane is a relatively short-lived gas that survives in the atmosphere for only about 12 years before it is broken down by chemical reactions.

Carbon dioxide​ takes the crown contributing 76% of anthropogenic emissions. It naturally survives in the atmosphere between 20 to 200 years with 20% surviving for many thousands of years.

Carbon Sequestration is vital for overcoming the climate crisis

In order to quickly return atmospheric greenhouse gases to safe levels and avoid triggering positive feedback loops, not only do we need to stop burning fossil carbon, we need to implement carbon sequestration strategies. In other words, we need to take CO​2​ out of the atmosphere and store it away, perhaps underground, or more likely, in material forms, like wood. There are two types of carbon sequestration: Geological Carbon Capture and Storage (GEO-CCS) and Biological Carbon Capture and Storage (BIO-CCS) also known as carbon farming. GEO-CCS uses technology, including sorbents, electricity, and heat, to capture and store the whole CO​2​ molecule ultimately underground. BIO-CCS relies on the natural photosynthesis of plants to separate the oxygen atoms of CO​2​ and store the carbon atoms in the stem and roots of plants. Some BIO-CCS examples include forestry, timber and biomass plantations, and ecosystem protection and restoration.

Geological carbon capture & storage

The most popular GEO-CCS technological solutions currently under development to capture CO​2​ from the atmosphere involve ​giant walls of fans,​ sorbents, and heat to extract CO​2​ from the air. The CO​2 must then be compressed at 300psi to become a liquid form and then transported and pumped underground into porous rock, empty oil wells, and mines. All these steps, including the upstream emissions required to construct an air-sourced carbon capture facility, requires a tremendous amount of energy for each molecule of CO​2​ removed. ​Experts​ in the field believe that money is much better spent on renewables (wind, water, solar) that prevent the CO​2 and non-CO​2​ air pollutants from fossil-carbon combustion from getting up there in the first place.

Until we stop burning fossil carbon and have excess renewable energy, GEO-CCS will remain an inefficient and impractical solution for sequestering atmospheric CO​2.​

Biological carbon capture & storage: Carbon Farming

All green growing plants sequester carbon from the atmosphere by storing it in their roots, stems, and leaves. Unlike GEO-CCS solutions, storing carbon in plants require only sunlight, water and green leaves.

Since BIO-CCS only stores carbon, unlike GEO-CCS that stores the much bulkier CO​2 molecule, the oxygen atoms of CO​2​ are returned to the atmosphere and help reverse declining global ​oxygen levels​. ​​BIO-CCS, or more specifically the planting of trees, is a very ​inexpensive option​ for sequestering carbon. The drawback of using plants to sequester CO​2​ is that they require space and lots of it.

When we stop burning fossil carbon we will still be adding about 27% of our current emissions (14.9 gigatonnes of CO​2e​ q) into the atmosphere each year. Perhaps a realistic goal is that we should aim to sequester at least 20 gigatonnes of CO​2e​ q/year to not only capture the equivalent emissions we cannot avoid but also to start drawing down our atmospheric CO​2​ levels back below 350 PPM.

How much land will be required for carbon farming to sequester 20 gigatonnes CO​2e​q/year? Experts estimate afforestation of land in the USA could sequester ​8.4 tonnes/CO​2/​hectare per year​. To sequester 20 gigatonnes would require the planting of 2.4 billion hectares of land, an area the size of North America.

The values are about 3 times better in the tropics that support a year-round growing season and have suitable rainfall. ​25 tonnes CO​2/​hectare per year​ could be sequestered by tree planting which would require 800 million hectares of land, an area slightly larger than Australia.

With a growing population and the world’s tropical forests being cleared each year for agricultural land to feed the world, it seems unlikely that we can find the land to sequester this much CO​2​ with trees, or is it?

Look for part 2 of this article, where I discuss our options.

About the author: Ryan Logtenberg is a director of the 2 Degrees Institute. The 2° Institute mission is to develop and support strategies that empower people to make the behavioral and lifestyle changes needed to prevent our planet from warming by 2 degrees Celsius.


‘Time to act’: Government slammed by CCC over ‘shortfall’ in net zero policy action

Image: Getty

Image: Getty

Current policy is insufficient for previous emissions targets and must be ramped up if the net zero goal is to be reached, the Committee on Climate Change (CCC) has said.

Only one of the 25 policy recommendations made by the CCC last year for getting the fourth and fifth carbon budgets back on track been implemented, it revealed as it published its 2019 Progress Report. Ten of those policies have not shown even partial progress.

The CCC has claimed there is a substantial gap between current plans and future requirements and an even greater shortfall in action and that net zero policy must be implemented across all levels and departments of the government. Policy should also be business friendly, providing a clear direction and investable set of rules and incentives that leave room for innovation.

Lord Deben, CCC chairman, said legislating for net zero and making a bid to host COP26 are “historic steps forward” that position the UK as a global leader, but action is needed to support this.

“It’s time for the Government to show it takes its responsibilities seriously. Reducing emissions to net zero by 2050, requires real action by Government now," he said.

Vehicle bans and EV incentives

Surface transport emissions – which excludes aviation and shipping - fell by 2% in 2018, with the greatest reduction coming from cars. But transport is on the ‘frontline’ of decarbonisation as the largest emitting sector, the CCC said. Its report urges the Department for Transport to prioritise reducing emissions, working with the Department for Business, Energy and Industrial Strategy and HM Treasury to achieve this.

A phase out of internal combustion engine vehicles should be brought forward to between 2030 and 2035, a recommendation reiterated from the CCC’s Net Zero report. An earlier date is not only needed to reduce transport emissions in line with 2050 targets, it said, but will also have lower financial costs. This would mean a rapid increase in the market share of EVs during the 2020s.

The government should also clarify that only battery electric or other zero carbon vehicles will be permitted to be sold after this point, a recommendation echoed by the Centre for Research into Energy Demand Solutions (CREDS) in a report last week.

In the next year, the government should also put into place stronger incentives for the purchase of electric vehicles and create a plan for the roll out of zero emission HGVs. In the long term, the development of charging infrastructure should be continued, a decision on the future of HGVs should be made and a 98% reduction in emissions by 2050 should be aimed for.

The CCC did, however, praise the increased deployment of charging infrastructure, which rose from 16,700 chargers in June 2018 to 23,500 in June 2019.

Routes to market and contingency plans

Decarbonisation of the power sector was celebrated overall in the report, with CCC saying the success was driven by strong policy. Emissions in the sector fell by 10% in 2018, placing them 68% below 1990 levels. And low carbon generation accounted for a record high of 54% of the UK’s total generation, with renewables increasing by 12%.

However, emission reductions are slowing in comparison to the average annual reductions of 14% since 2012. In addition, contingency plans for the possibility of new nuclear projects not being delivered have not been set out. Plans for additional low-carbon generation to be brought forward in this scenario should be created in the next year.

The CCC also pointed to contract prices for nuclear projects remaining significantly higher than those of renewable technologies such as wind and solar.

In the forthcoming Energy White Paper, the government should outline plans for a route to market for solar and onshore wind. Blocking the technologies from participating in the Contracts for Difference auctions without providing another route to market is limiting the potential speed of decarbonisation and adding to costs, the CCC said.

The Energy White Paper should also aim to support a quadrupling of low-carbon power generation by 2050. This would mean the deployment of more low-carbon capacity in the 2020s, which would potentially be consistent with a carbon-intensity of 50gCO2/kWh by 2030.

The government should also develop and deliver, in coordination with Ofgem, a plan to upgrade networks in the 2020s to accommodate new electricity demands, for example from electric vehicles, and future proof them to help limit costs.

Longer term milestones for the power sector include reaching 320TWh of low carbon generation by 2030 and 99-100% low carbon generation by 2050.

The CCC also said it doesn’t expect renewables without a government-backed contract to be deployed at a enough scale to meet a potential low-carbon generation gap in 2030. And additional low-carbon generation from long-term contracts will affect the marginal value of new generation and the volatility of revenue, the CCC says, which could diminish the role of renewables without a government contract over the next decade.

Steps to be taken

Alongside recommendations for individual sectors, the CCC also issued four strategic priorities for the government:

  • Net zero must be embedded across all levels and departments, with strong leadership at the centre.
  • Government policies must be business friendly to encourage investment and innovation.
  • The public should be engaged in the transition, and policy and low-carbon products should be designed to reflect this.
  • International increases in ambition should be supported and UK ambition should be celebrated.

Other recommendations made by the CCC to reach net zero include the development of a plan for operational carbon capture and storage by the mid-2020s, a strategy for developing low carbon hydrogen use as well as the start of large-scale hydrogen trials and detailed policy for energy efficiency.

A government spokesperson said the government has “set a strong example” by legislating for net zero, reducing power sector emissions and championing adaptation.

“We know there is more to do and legislating for net zero will help to drive further action,” the spokesperson said, continuing to outline government plans to set out solutions for tackling emission from heat, energy, transport, aviation, agriculture and transport in the coming months. A formal response to the recommendations will be released in October.


UKPN, Piclo herald ‘significant milestone’ as winners emerge from maiden commercial flexibility tender

Image: UKPN.

Image: UKPN.

UK Power Networks (UKPN) and energy technology firm Piclo are celebrating the completion of a new flexibility auction, the first time the latter’s online platform has been used for commercial purposes.

The platform, years in development, has been tested extensively but has now been used at the commercial scale for the first time, helping UKPN procure 18.1MW of flexibility.

Contracts worth £450,000 have been awarded to AMP Clean Energy, Limejump, Powervault and Moixa, with the flexibility procured used by UKPN to offset more costly grid reinforcements in constrained areas of the network.

The Piclo platform creates a heat-map of areas of congestion, correlating them with providers of flexibility with resources such as demand side response, battery storage and behind-the-meter generation. Network operators can then contract this capacity to minimise these bottlenecks.

The auction was first announced in May this year, with details to follow “in due course”, and following its success, UKPN has now handed Piclo an ongoing commercial contract, the tech company’s second such contract having secured a similar arrangement with Scottish and Southern Electricity Networks earlier this year.

James Johnston, chief executive and co-founder at Piclo, said the company was thrilled from the results of its first auction, realised after “years of trials and ongoing development”.

“As renewables have boomed across the UK and internationally, grid congestion and the network flexibility required to affordably alleviate it have become top priorities for network companies.

“This first full, commercial auction will be the first of many as distribution companies across the UK and even internationally take UK Power Network’s lead in enabling the shift to a smart, flexible, low-carbon power system.”

Piclo continues to work with all six of Britain’s distribution network operators after penning an agreement with Western Power Distribution late last year, and the company also counts tens of flexibility providers in its ranks.

Sotiris Georgioupoulos, head of smart grid development at UKPN, said flexibility offered the DNO a “wealth of opportunities”.

“All of the bids we accepted in this tender round met our robust economic criteria to ensure they will benefit our customers by offering lower costs in comparison to the traditional approach of building new assets. The UK is a world-leader in smart grid technology and flexibility has a key role to play as we move towards a decarbonised, decentralised and digitised network that will offer significant benefits to our customers.”


Local smart energy systems key to net zero, says ADE

Image: Nottingham City Council

Image: Nottingham City Council

Local energy generation and flexibility are essential to reaching net zero, new analysis from the Association for Decentralised Energy (ADE) has argued.

Local onsite generation is key to a net zero future, the ADE says, advocating for smarter, more flexible energy systems supported by government and Ofgem. The association predicts that the traditional centralised approach will be replaced by a smart, user-led system, with local energy and consumers at the heart.

It argues that the way to achieve this future energy system is through on-site flexibility and energy storage, energy efficiency, implementation of heat networks and on-site combined heat and power systems.

The ADE points to estimates made by the National Infrastructure Commission that reducing peak demand through energy management by 5% would reduce power system costs by £200 million each year and give consumers £790 million a year in added benefits.

And that peak power demand could be reduced by up to 15% if the UK achieves comparable levels of flexibility to other markets such as Australia and the US.

It is now calling on the government and Ofgem to support this through opening up access to markets to ensure payment for local generation and flexibility, for example through changing the timings of energy use, storage or demand flexibility.

Lord Deben, chair of the Committee on Climate Change, said local onsite generation and energy management will play “a central role” in achieving net zero.

“Giving customers the power to help drive the UK’s low carbon transition is vital and we need credible UK policies, across government, that inspire a strong response from business, industry and society as a whole.”

Tim Rotheray, director of the ADE, said now is the time to focus on the role of local energy.

“If government puts customer-led energy at the heart of its policy making and works alongside business, we can put power back into the hands of customers and meet our net zero in a fair way.”


Consultation on Flexibility Services

‘Simpler is better’: Open Networks Project launches consultation to simplify flexibility services

Image: Arsenal FC.

Image: Arsenal FC.

Flexibility markets must be simple for stakeholders if the UK is to truly “unlock” the power of new energy technologies, the Energy Networks Association’s Open Networks Project has said.

The project, which aims to transform the way the country’s energy networks operate, has launched a new consultation aimed specifically at those nascent flexibility markets, intending to understand how network operators can best aid homeowners, businesses and communities benefit from them.

Having unveiled a landmark flexibility commitment late last year, network operators in the UK have been quick to embrace flexibility markets as a cost effective alternative to costly reinforcement works.

Earlier this week Western Power Distribution announced that it was seeking to procure more than 140MW of flexibility services through a regional tender programme, targeting areas of constraint, as it seeks to ramp up its own adoption of flexibility

Indeed, research compiled by the government’s National Infrastructure Commission has shown that a more flexible energy system could save consumers as much as £8 billion a year by 2030.

The ENA’s consultation also follows on from its recent ‘Six Steps for Delivering Flexibility Services’ document, and is seeking further detail on how those steps can be developed and used to bring together best practice guidelines and standardisation in the market place.

David Smith, chief executive of the Energy Networks Association, said that the launch of the consultation made a fundamental point regarding flexibility, that simpler is better.

Ease of access to flexibility markets for the widest possible range of people has to be right at the top of the agenda.

“That’s key so that Britain’s energy networks can access the deepest, most liquid flexibility markets possible to help connect more clean energy technologies to the grid at the lowest possible cost to the public, all whilst creating an environment that fosters the kind of smart energy innovation that Britain has become known for the world over.”

In addition to refining the six steps, the consultation is to narrow in on the end-to-end processes required when procuring flexibility services and the commercial arrangements that underpin them. While the work is expected to continue into next year, short-term changes are also being explored.

More information on the consultation, which is open until 23 August 2019, can be found here.


Dutch RDF import tax could see waste cost hike

EXCLUSIVE: 3 JULY 2019 by Will Date at LetsRecycle.com 

Moves by the Dutch government to tackle climate change may include a tax on the import of refuse derived fuel (RDF) which could have major impacts on the cost of residual waste disposal for businesses and councils in the UK.

Members of the Dutch parliament are meeting later today (3 July) to discuss the Netherlands’ National Climate Agreement, which was outlined by the Minister of Economic Affairs and Climate Policy, Eric Wiebes, last week.

AEB

The AEB facility in Amsterdam is among the EfW facilities in the Netherlands to import feedstock from the UK

The National Climate Agreement follows the conclusion of the Urgenda court ruling. This is forcing the Dutch government to take more stringent action to reduce greenhouse gas emissions by the end of the decade.

Late yesterday evening it emerged that the proposals are likely to include the potential for a tax on the imports of ‘foreign waste’, with a knock-on effect on the trade in RDF from countries such as the UK. And, the tax could also impact on waste wood exports.

Thermal

Despite more energy from waste (EfW) capacity coming online in the UK – a significant proportion of UK waste is exported into mainland Europe in the form of RDF or SRF [Solid Recovered Fuel] for thermal treatment. The Netherlands is the largest single destination for recovered fuels from the UK, receiving a total of 1.28 million tonnes of material from England in 2018 alone.

The Dutch Government estimates that as much as 25% of the waste processed in the country’s EfW plants comes from outside the country – and a tax on domestic waste going to plants inside the country has been in place since 2015. The level of the proposed import tax has yet to be disclosed, but the internal tax stands at around €30/tonne.

British, Dutch and German waste management industries have all expressed concerns at the proposals for a tax on foreign waste, as well as local authorities in the UK who fear that costs for the disposal of residual waste will rise as a result of a tax.

Were the cost of exporting waste from the UK to the Netherlands to increase significantly, this is likely to see more waste sent to landfill in the UK, it is thought.

‘Crippling’

The Environmental Services Association (ESA), which represents UK waste management businesses, has written to Dutch MPs to express its concerns at the proposed tax. It described the measure as potentially ‘crippling’ to the UK waste management industry.

“We are currently experiencing an under capacity of residual waste treatment”

ESA

Its letter sent late yesterday, said: “We are currently experiencing an under capacity of residual waste treatment which is expected to continue even as we meet 65% municipal recycling.”

“Given that new EfW plants have a long lead-in time, the introduction of the proposed tax would be crippling to the UK waste management industry and local authorities who will have no other option in the short-medium term than to landfill their residual waste at great environmental cost.”

A similar note of caution has been sounded by the Dutch Waste Management Association (DWMA).

Robbert Loos, director of the DWMA, said: “It is incomprehensible where this extra tax suddenly comes from. We are calling on the government not to include this measure in the new national Tax Bill. It is completely unclear how much CO₂ emissions the government is aiming to achieve with this measure.”

Emissions

DWMA has highlighted that were waste from the UK to be taxed out of Dutch EfW plants, this could lead to material instead being sent to landfill – with a potential upturn in CO2 emissions as a result.

Mr Loos added: “Our members are shocked and consider this to be a bad signal for sustainable investments in the waste sector. We would like to first thoroughly map all related consequences, to prevent that the government is shooting itself in the foot in view of the circular economy – and climate ambitions, which are foremost related to the European context.”

“We are buying an energy from waste service as we pay a gate fee and most of the plants are paid off”

RDF exporter

It is felt that in the short term the measure could have a major detrimental effect on the UK waste costs. However, some have suggested that this may help encourage more investment in energy from waste plants in the UK and in the UK becoming more attractive as domestic outlets are required – as well as pointing out that exports of RDF have ‘levelled off’ in recent years.

One RDF industry source told letsrecycle.com: “Don’t forget that the Dutch waste management industry is making a fortune from the UK. “We are buying an energy from waste service as we pay a gate fee and most of the plants are paid off, so they don’t even have capital costs.”


Questions raised about £1trn adaptation cost to net zero carbon economy

1 July 2019, source edie newsroom

Questions have been raised about the £1trn cost estimate of establishing a net-zero carbon economy by the Common's Business, Energy and Industrial Strategy (BEIS) committee.

The BEIS committee in the Commons is questioning the Chancellor on the net zero carbon economy costs as part of its investigation into the Clean Growth Strategy

The BEIS committee in the Commons is questioning the Chancellor on the net zero carbon economy costs as part of its investigation into the Clean Growth Strategy

Chair of the committee, Rachel Reeves, has put a number of questions to the Chancellor of the Exchequer, Philip Hammond, following his claim last month that it would cost the UK economy around £1trn to meet net-zero carbon emissions by 2050.

These questions include Treasury modelling on public expenditure savings arising from net-zero – for example, reduced NHS spending from healthier diets and reduced air pollution; how the Treasury plans to fund the transition to net zero; and the strategy to ensure the fair distribution of costs and benefits. It also quizzed the Chancellor on how a five-year review of the net zero target will be conducted.

The letter comes ahead of a BEIS committee session on net zero with the chair also writing to Treasury minister Chris Skidmore. She asked the minister, who will attend the session, for his thoughts on the Government’s approach to net zero by 2050 – including plans for international aviation and shipping, an issue raised by youth climate striker Greta Thunberg and which currently sits outside of national emissions reporting.

Net zero

The hearings by the committee are part of its ongoing work to interrogate the government’s Clean Growth Strategy as well as the Environmental Audit Committee’s complementary work on greening government commitments.

The Clean Growth Strategy, launched in 2017, details how the government will make multi-billion-pound investments into low-carbon innovations and household energy-efficiency that will push the UK towards its future carbon budgets.

But progress has been slow with Carbon Capture technology and the BEIS committee has previously reported that the government’s umbrella Industrial Strategy is “not sufficient” to support decarbonisation, future-proofing and productivity-boosting throughout Britain’s “everyday economy” rather than just high tech sectors, with no sector-wide deals for retail and hospitality produced yet.

The questions about net zero funding also follow work the committee has already done on net zero including a session on 18 June which included protest movement Extinction Rebellion, WWF, and the Environmental Defense Fund.

Last week the Commons voted the net zero carbon target into law, which followed a previous debate on a climate emergency also resulting in a declaration across the national government in Westminister as well as the devolved administrations of Scotland and Wales.

Listen on demand: edie's climate emergency Q&A webinar

edie brought together energy and climate experts from Nottingham City Council, Skanska, Business in the Community (BITC) and Ørsted for a live Q&A-style webinar about the UK's climate emergency and net-zero carbon targets.

--- Listen to the webinar here ---

James Evison