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The Renewables Obligation (RO) is the Government's main mechanism for supporting generation of renewable electricity. Since its introduction in 2002 the RO has been successful in stimulating growth in renewable electricity generation - it has more than doubled since 2002 - and a project pipeline of more than 11GW is in place across the UK.
However, there are constraints on the availability and deployment of the cheaper forms of renewables. This means that to move beyond 10% of electricity generated from renewable sources and towards the Government's long-term aspirations for renewable energy, other technologies such as offshore wind and biomass need to come forward.
The 2006 Energy Review Report announced a number of proposals for long-term reform of the RO. An initial Consultation on proposals for long-term reform of the Renewables Obligation was published in October 2006. This consultation was in two parts. The first part covered the changes in the Energy Review Report. The second part covered a number of technical and administrative changes which have now been introduced through the Renewables Obligation Amendment Order 2007.
A further consultation on long-term reform of the Renewables Obligation setting out the proposals in more detail was published on 23 May 2007 alongside the Energy White Paper - 'Meeting the Energy Challenge'. The consultation closed on the 6th September 2007 and stakeholders' responses were published.
On 26 June 2008 Government published a Statutory Consultation setting out detailed proposals on how we will implement banding and the associated changes in the statutory order. The Consultation closed on 30 September 2008.
The Government Response to the Consultation, setting out our decisions on the detail of implementing banding, was published on 2 December 2008. A draft Renewables Obligation Order 2009 was published alongside the Government Response.
As part of the Budget 2009, the Chancellor announced on Wednesday 22 April that we will be reviewing the level of ROC support for offshore wind.
If the review confirms the evidence we have received to date, we expect to consult on increasing support to 2 Renewables Obligation Certificates (ROCs) for every megawatt hour generated. This access to additional support would be for a time-limited period and subject to a number of conditions. This builds on the recent uplift to 1.5 ROCs for all offshore wind projects.
The decision to launch an early review was based on evidence provided to the Department of Energy & Climate Change, including a report produced by Ernst & Young on DECC’s behalf. This report was published by DECC on Monday 27 April and is available below:
We hope that the Q&A document below addresses some of the questions and concerns you may have following the announcement:
Further details of the review process and eligibility criteria are set out in the document below.