11th July 2006

In the Energy Review released today the Government restated their commitment to the Microgeneration Strategy and committed themselves to an ‘aggressive implementation’. The Micropower Council welcomed the reinforcement of the role of micropower in the future policy mix.

In addition to the Microgeneration Strategy the Review contains the following additional measures:

1. Developing a new Planning Policy Statement (PPS) on Climate Change. The Government plans to consult on this later in 2006, and introduce it in 2007. The new PPS will also encourage the use of more sustainable energy sources, including microgeneration, and Combined Heat and Power. Pg 40 Para 2.16.6
2. Consideration of changes to EEC to include all forms of microgeration. “The Government will therefore be consulting this summer on whether to extend the range of measures allowed under the third phase of EEC. Pg 45 Para 3.32
3. In the longer term the prospect of a duty on energy suppliers to cap the growth of household emissions.
4. The Government will undertake a wide-ranging review of the long-term potential and challenges of distributed generation, including Combined Heat and Power, as an alternative or large-scale supplement to centralized generation. Incorporating a range of scientific, technical, economic and behavioural issues, it will be taken forward as part a Foresight Project looking at sustainable energy management in built environment, by the Office of Science and Innovation. Pg 76 Point 13
5. The Government and Ofgem will lead a comprehensive review of the incentives and barriers that impact on distributed electricity generation including CHP. This Review will report in the first half of 2007. Pg 75 Point 11

The Energy Review restates and reinforces the following provisions already announced:

6. The Government recognises that uncertainty over the planning status of new equipment, and the cost and time it takes to obtain planning permission, are real barriers to the more rapid adoption of such technologies. We are therefore proposing to ensure that, as far as possible, all such technologies are exempted from the need for a specific planning application through the General Permitted Development Order (GPDO). Pg 71 Para 3.37
7. The Climate Change and Sustainable Energy Act 2006 empowers government to require all energy suppliers, through licence modifications, to offer to acquire exported electricity. The Secretary of State has to make a decision whether to use these powers twelve months after commencement, that is, in the second half of 2007. If energy suppliers do not develop a system to acquire electricity from microgenerators, Government will intervene. Pg 76 Point 12
8. Producing reports on energy measures for local authorities – including promoting microgeneration – that authorities will have to have regard to in the exercise of their functions; promoting community energy projects; a review of communications activity to assess how to improve, information provision; and a new power for Parish Councils to promote microgeneration in their own parishes. Pg 76 Pt 14
9. Carbon neutrality: Government confirms its ambition to support the move towards carbon neutral developments, through implementation of the Code for Sustainable Homes and making clear that this will set the direction for further tightening of Building Regulations. Carbon-neutrality will not be possible in most developments without some form of distributed energy. Pg 74 Point 1
10. Fuel Poverty: The Government will ‘explore the scope for using some of the money already available for the Low Carbon Building Programme to install new technologies (including biomass and heat pumps) to bring renewable sources of energy to elderly households and others in cold homes’. Pg 58 Para 2.111
11. Recommitment to PPS22: The Government plans to ‘consult on this later in 2006, and introduce it in 2007.... the new PPS will make clear that the location and design of new developments should also promote the reduction of carbon emissions....The new PPS will also encourage the use of more sustainable energy sources, including microgeneration, and Combined Heat and Power’. Pg 40 Para 2.16.6
12. Local authorities: ‘The Housing and Planning Minister made it clear in a statement to Parliament in June 2006 that all English planning authorities should include policies in their development plans that require a percentage of the energy in new developments to come from on-site renewables, wherever viable. We will continue to monitor this situation, with a view to taking further action, if necessary, to ensure that local authorities set appropriate targets in this area’. Pg 41 top para

Other items in the Energy review relevant to microgeneration are:

13. Consult on ‘possible adjustments to the RO (“banding”) to provide greater support to emerging technologies and reduced support for more established technologies’.Pg 106
14. Take Renewables Obligation to 20% by ‘extending Obligation levels to 20% (when justified by growth in renewable generation)’ and ‘adapting the RO to provide greater support to emerging technologies and less support for established technologies’. Pg 101 Para 5.30
15. Renewable Heat. The Government noted in its response to the Biomass Task Force its recommendation that a Renewable Heat Obligation should not be pursued at this time, but indicated that we would further consider the evidence on such a measure. However a number of practical difficulties need to be addressed in relation to the implementation of a direct market-based incentive for heat....We will however continue to be open to solutions to these practical issues and will report on this in April 2007. Page 72 Para 3.46-7
16. There will be an Energy White paper around the turn of the year
17. EU ETS: ‘The Government is committed to there being a continuing carbon price signal which investors take into account when making decisions. The EU ETS will remain the key mechanism for providing this signal. The Government will continue to work with its international partners to strengthen the EU ETS to make it more effective. We will keep open the option of further measures to reinforce the operation of the EU ETS in the UK should this be necessary to provide greater certainty to investors’. Pg 35

For further information: Jane Vaus, Head of Media and External Affairs, 020 7924 0795 or 077480 10447 or jane.vaus@micropower.co.uk

NOTES

The Micropower Council is a cross-industry body whose membership comprising electricity and gas companies, manufacturers, trade associations, professional institutions, not-for-profit companies, non-government organisations, charities and private individuals, all of whom have a strong interest and expertise in the development of the micropower sector. More information at www.micropower.co.uk

The Micropower Council has been the prime mover behind the Climate and Sustainable Energy Act which seeks to overcome the barriers to greater uptake of microgeneration. Full details of the measures in the Act and the Government’s Microgeneration Strategy can be found at www.micropower.co.uk/publications/ccsebillmeasures.pdf

The Government’s Energy Review and press release can be found at: The press release for the Energy Review is at: www.gnn.gov.uk/environment/detail.asp?ReleaseID=213626&NewsAreaID=2&NavigatedFromDepartment=False www.dti.gov.uk/energy/review/index.html

Notes to Editors

Read the Government’s Microgeneration Strategy

Download this release as a pdf