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 08 August 2007
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What is the Renewables Obligation?

The Renewables Obligation requires licensed electricity suppliers to source a specific and annually increasing percentage of the electricity they supply from renewable sources. The current target is 6.7% for 2006/07 rising to 15.4% by 2015/16.

It is expected that the Obligation, together with exemption from the Climate Change Levy for electricity from renewables, will provide support to industry of up to £1bn per year by 2010.

Eligible renewable sources

At the end of 2005 generation from renewable sources eligible under the Obligation stood at 4%. This rises to 4.2% if non-eligible sources are included.

Eligible renewable sources are listed in the following table:

SourceEligibility

Landfill gas

Yes

Sewage gas

Yes

Hydro exceeding 20 megawatts declared net capacity (dnc)

Only stations commissioned after 1 April 2002

Hydro 20 megawatts or less dnc

Yes

Onshore wind

Yes

Offshore wind

Yes

Co-firing of biomass

Yes. (There are no restrictions on the amount of co-firing a generator can undertake. However, suppliers can only meet 10% of their obligation from co-fired ROCs.)

Other biomass

Yes

Geothermal power

Yes

Tidal and tidal stream power

Yes

Wave power

Yes

Photovoltaics

Yes

Energy crops

Yes

 

What about the eligibility of energy derived from waste?
Type of Generating stationMixed wasteWaste that is purely biomassEnergy crops, agricultural waste and forestry material
IncinerationIneligibleEligible*Eligible*
Pyrolysis, gasification and anaerobic digestionEligible for the biomass fraction of wasteEligible*Eligible*
Combined Heat and Power (CHP)Eligible for the biomass fraction of waste produced as good quality CHP**Eligible*Eligible*
Co-firingIneligibleEligible* (There are no restrictions on the amount of co-firing a generator can undertake. However, suppliers can only meet 10% of their obligation from co-fired ROCs.)Eligible*

Notes:

  1. * Subject to a maximum fossil-derived energy content of 10%.
  2. ** CHP stations must be accredited under the CHP Quality Assurance scheme to be eligible. For schemes that are fully compliant with the Good Quality benchmark, they receive ROCs on the electricity generated from the biomass fraction of the waste. For schemes that are partially compliant, this is scaled back depending on their efficiency.
  3. Only stations first commissioned or re-equipped on or after 1 January 1990 (except micro-hydro and co-firing stations) are eligible.
  4. All stations must be located within the UK, its territorial waters or the Continental Shelf.

Where Can I get further information on the operation of the Renewables Obligation?

The Obligation is administered by Ofgem. For further information on the Obligation visit www.ofgem.gov.uk.

Contact Ofgem:

Renewables Administrator
The Office of Gas and Electricity Markets
9 Millbank
London SW1P 3GE

Email: renewable@ofgem.gov.uk
Fax: 020 7901 7387

The Renewables Obligation (Scotland) and consultation documents are available at www.scotland.gov.uk/consultations/.

For information on Northern Ireland visit www.energy.detini.gov.uk.

Where can I get further information on the underlying policy?

Contact the BERR:

Nicola Barber
Renewables Policy & Development
Department for Business, Enterprise and Regulatory Reform
1 Victoria Street
London SW1H 0ET

Email: nicola.barber@dti.gsi.gov.uk
Tel: 020 7215 2651

 

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