The following email was sent on the 13th of February 2013 to DECC as a formal submission to the consultation on competitive allocation of contracts of Feed-in Tariffs with Contracts for Difference (FiTs CfDs) under the Electricity Market Reform (EMR) package.
This email is a response to the Consultation on Competitive Allocation:
https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/271919/Competitive_allocation_consultation_formatted.pdf
1. Do you agree with the Government’s proposed list of “established” and “less established” technologies?
Broadly speaking, we agree. However, we see no reason for thinking that onshore wind and solar and hydro projects of capacity less than 5 MW should be regarded as not established. If anything, the industry has more experience of developing such sites than very much larger sites.
While we understand that there may be other reasons for wanting to exclude small sites from the competitive allocation process, this goal could and should be achieved with a much lower threshold, for instance 500 kW.
In this context we note that government uses the Renewable Energy Planning Database (REPD) as the grounding for the view that there is ample renewable capacity in the pipeline, and that therefore competitive allocation can be introduced earlier than anticipated. On the basis of our own information and research we have concluded that the REPD almost certainly significantly understates the quantity of applications below 5 MW, particularly for wind and solar. Thus, we conclude a) that the case for competitive allocation is in fact even stronger than government believes, and that b) there is a strong case for reducing the “established technologies” threshold in order to achieve the overall aims of competitive allocation, namely constraining costs within the LCF and delivering value for money to the consumer.
In addition we would recommend that DECC undertakes detailed surveys of local authorities in order to improve the REPD.
2. Do you agree that the “established” list of technologies should be subject to competition from the outset of an allocation process as part of helping to manage the LCF and delivering value for money?
Yes, we agree. Delivering value for money to the subsidising consumer is a matter of the first importance, and should be given priority over industry sensitivities.
We note also that a prompt start to competition will avoid minimise the interregnum in which unintended consequences may manifest themselves.