After DECC announced cuts to the Renewable Obligation some in the renewables industry have admitted surprise over how small the cuts were.
Rick Eggleston, Managing Director of REpower UK said the cuts would still ensure growth remains healthy across the wind sector. He said: “The level of cut in the case of onshore wind is to the lower end of industry expectations, with many of us having predicted something deeper. The reality is that in the case of onshore wind, the industry has achieved significant cost reductions in recent years as the industry matures and becomes more competitive. The cut in ROC level for onshore wind was inevitable, and at 0.9 is at an appropriate level to encourage the industry to drive towards further cost cuts, while reaffirming the UK Government’s commitment to renewables.”
Most importantly for industry, a sense of direction was given by Government. Mr Egglestone said: “For us, as a leading turbine manufacturer, this gives us the clear visibility we need over the next 5 years. I also believe DECC’s phased approach to the new levels should result in a degree of stability.”
Juliet Davenport, founder and CEO of Good Energy agreed over the severity of the cuts: “These changes aren’t as bad as many of us had feared, but it’s clear there is a need for a more nuanced approach from DECC in the face of pressure from the Treasury.
“The RO has and will continue to play a vital, and cost effective role in speeding up investment in renewables and delivering energy security. That will help move us away from the very fossil fuels that are causing families and businesses serious headaches about how they are going to pay their energy bills.”
Reductions include a fall of 1 ROC to 0.9 ROC in 2013 for onshore wind, and from 2 ROCs to 1.9 ROCs from April 2015, and to 1.8 ROCs in April 2016 for the offshore wind sector.