New technologies, which can be built at much smaller scale (for example wind, solar and combined heat and power) have opened up new opportunities for different forms of ownership, such as projects owned by community groups, co-operatives, local authorities and commercial organisations. This has the potential to tap into new sources of investment and may also help to overcome some of the public acceptability problems that have plagued larger-scale energy projects.
The Government currently supports small-scale renewables (smaller than 5MW in size) through the feed-in tariff scheme. Larger renewables are supported under the Renewables Obligation (RO) and in future, will be supported through Contracts for Difference (CfD). The Committee has previously argued that medium-sized projects (between 5-50MW) are disadvantaged because they cannot access the feed-in tariff, yet often lack the financial capability to deal with the complexities of the RO/CfDs. In addition, they may struggle to obtain the reference price under the CfD regime, meaning they would lose out financially.
The Committee is seeking to explore the role that medium-sized local energy projects could play in the UK’s energy system and the extent to which Government policy currently supports these types of development.
Terms of reference
The Committee invites responses addressing some or all of the following questions:
- What contribution could medium-sized energy projects (5-50MW) make to the UK’s climate change, energy security and energy affordability objectives?
- What different models of ownership exist for medium-sized energy projects and how prevalent are they in the UK?
- What types of financing model are most suitable for small- and medium- scale projects? Do these differ from the financing models used for larger-scale projects?
- Why are community-owned energy projects more prevalent in countries like Germany and Denmark than they are in the UK?
- Is there any evidence that medium-scale energy projects are more likely to be accepted by local communities?
- What appetite is there for community-owned medium-scale energy projects in the UK?
- What appetite is there among private sector organisations in the UK to invest in their own medium-scale energy projects?
- What appetite is there among UK local authorities to invest in their own medium-scale energy projects?
- What are the barriers to medium-scale energy projects in the UK?
- How effective are current Government policies in encouraging local and medium-sized energy projects? Could they be improved in any way?
The deadline for the submission of written evidence is Tuesday 23 April 2013
Notes on submission of written evidence
As part of a scheme to encourage paperless working and maximise efficiency, the Committee is piloting a new web portal for online submission of written evidence. Written submissions for this inquiry should therefore be submitted via the Local Energy Inquiry Page on the Energy and Climate Change Committee website.
The deadline is Tuesday 23 April 2013. As a guideline submissions should be no longer than 3000 words, please contact the Committee staff if you wish to discuss this. If you need to send hard copy please send it to: The Clerk, Energy and Climate Change Committee, 7 Millbank, London, SW1P 3JA.
Submissions must be a Word document, in the format of a self-contained memorandum. Paragraphs should be numbered for ease of reference, and the document should, if possible, include an executive summary.
Submissions should be original work, not previously published or circulated elsewhere. Once submitted, your submission becomes the property of the Committee and no public use should be made of it unless you have first obtained permission from the Clerk of the Committee. Please bear in mind that Committees are not able to investigate individual cases.
The Committee normally, though not always, chooses to publish the written evidence it receives, either by printing the evidence, publishing it on the internet or by making it publicly available through the Parliamentary Archives. If there is any information you believe to be sensitive you should highlight it and explain what harm you believe would result from its disclosure; the Committee will take this into account in deciding whether to publish or further disclose the evidence.
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