Re g ula tory Drive rs for Bioma ss in the Unite d King dom BRE A - - PowerPoint PPT Presentation

BRE A 2016 Inte rna tiona l Confe re nc e a nd E xposition Pa ne l Disc ussion F rida y, 11 Nove mbe r 2016 8:30 AM

Pre se nte rs: T

• dd K

e rsc hb a um - V.P. Pro je c t De ve lo pme nt - Po we r, Sta nte c

Re g ula tory Drive rs for Bioma ss in the Unite d King dom

Compone nts of the UK’s prog ra m:

• F

ue l dive rsific a tio n fro m fo ssil fue ls

• Se c urity o f e ne rg y supplie s in the UK
• I

nve stme nt in ne w te c hno lo g ie s a nd industrie s

• Use a wide ra ng e o f le ve rs to de c a rb o nize the e c o no my
• Ob ta in 15% re ne wa b le g e ne ra tio n re so urc e s b y 2020
• F

und sub sidie s thro ug h the Clima te Cha ng e L e vy (CCL )

UK Re ne wa b le E ne rg y Dire c tive –

I ssue d b y the g o ve rnme nt in 2009

UK F ra me wo rk fo r a c tio n

T hre e ke y c ompone nts:



F ina nc ia l suppo rt fo r re ne wa b le s;



Unb lo c king b a rrie rs to de live ry; a nd



De ve lo ping e me rg ing te c hno lo g ie s

So me o f the Pla ye rs (b e fo re Bre xit)

UK Gove rnme nt E urope a n Union (E U)

Offic e Ga s a nd E le c tric ity Ma rke ts (OfGE M) Gre e n Inve stme nt Ba nk (GIB)

HM Re ve nue & Customs (HMRC)

E U Dire c tive s e .g .

Re ne wa ble E ne rg y Dire c tive 2009 E nsuring e ne rg y is:

• Se c ure & re silie nt
• Cle a n & susta ina b le
• Affo rda b le

Ma na g e s L a ndfill ta x Pro te c ts c usto me rs & de live rs Go ve rnme nt pro g ra mme s Se t up to a ttra c t priva te funds a nd “pump prime ”

Prime F unc tions

De pt. E ne rg y & Clima te Cha ng e

(DE CC is no w the De pt.

• f Busine ss, E

ne r gy & Industr ial Str ate gy)

3rd Annua l E uro pe a n Re ne wa b le E ne rg y Pro je c t F ina nc e Co nfe re nc e 2014, L

• ndo n

2020 UK Re ne wa ble E ne rg y T a rg e t E ig ht T e c hnolog ie s = 90% ta rg e t

T

• ta l 216 to 225 T

WH

Virg in Ma te ria l:

• Wood
• Stra w
• Crops

RDF & simila r Wa ste Wood Big E ne rg y Compa nie s e tc Wa ste Compa nie s Industry De ve lope rs

F e e dstoc k Pla ye rs MWH Proje c ts 5 to 25 MWe

UK Re ne wa b le s Ma rke t

F ina nc ia l Suppo rt fo r Re ne wa b le s

• Ce rta inty o f Pa yme nts o f Re ne wa b le Ope ra ting Cre dits (ROCs)
• F
• r e le c tric ity, inc e ntive pa yme nts mo nie s c o me o ut o f the L

e vy Co ntro l F ra me wo rk (L CF ) b udg e t whic h is a utho rize d a nnua lly

• Allo ws fo r third pa rty o wne rship
• Allo ws fo r third pa rty funding
• Pro vide s c a pita l inve stme nt, jo b s a nd g re e n g e ne ra tio n a sse ts in the ne xt te n

ye a rs to re pla c e a g ing g e ne ra tio ns a sse ts

Ob je c tive s o f ROC inc e ntive s

Inc e ntive Me c ha nisms ha ve :



Re duc e d c o sts o ve r time fo r a ll te c hno lo g ie s



E nc o ura g e d inno va tio ns b o th te c hnic a l a nd fina nc ia l



Stimula te d e mplo yme nt in the UK re ne wa b le s se c to r



E nsure d the UK will me e t its 2020 ta rg e ts fo r the re ne wa b le po we r

De ve lo pme nt o f I nc e ntive Me c ha nisms

Orig ina l ROCs 2002

• E

a c h re ne wa b le te c hno lo g y g o t sa me inc e ntive , this fa vo ure d e sta b lishe d te c hno lo g ie s a nd did no t drive the ma rke t fo rwa rd.

• Me c ha nism simply furthe r re wa rde d the sta tus q uo
• Re vie we d in 2003 to 2006 le a ding to a me nde d ROCs, se e b e lo w

Ame nde d ROCs 2009

• Ba nding intro duc e d whe re b y le ss e sta b lishe d te c hno lo g ie s re c e ive mo re inc e ntive s a nd vic e ve rsa
• Ste e rs industry to wa rds inve stme nt in le ss we ll de ve lo pe d te c hno lo g ie s, impro ving the “mix”

c o ntrib uting to the o ve ra ll re ne wa b le s ta rg e t

• I

nc e ntive s fo r e a c h te c hno lo g y re duc e d o ve r time in a ntic ipa tio n o f c o st re duc tio n & e ffic ie nc ie s.

• Sc he me c lo se s a fte r Ma rc h 2017

E MR & CfDs 2017

• As pa rt o f the E

ne rg y Ma rke t Re fo rm (E MR) the Re ne wa b le Ope ra ting Cre dits (ROCs) a re b e ing pha se d o ut a nd re pla c e d b y a F e e d in T a riff tha t o pe ra te s o n a Co ntra c ts fo r Diffe re nc e b a sis (CfDs)

• T

his c ha ng e to o k the o ppo rtunity to mo dify so me o f the ROCs te rms, whic h so me c o nside re d o ve r g e ne ro us.

• T

he ne w CfD a ppro a c h a lso a pplie s to nuc le a r po we r

• T

he CfDs a re a llo c a te d b y a uc tio n o n c a 12 to 18 mo nth inte rva ls intro duc ing a c o mpe titio n e le me nt

Re ne wa b le Ope ra ting Cre dits (ROCs) pa yme nts

Unde r the ROCs re g ime g e ne ra to rs we re pa id a t a ra te o f:

Pa yme nt pe r MWh e xporte d = AxB + C

Whe re A = b a nding multiplie r fo r the te c hno lo g y in q ue stio n B = va lue o f a ROC a t the time in q ue stio n, the se a re a tra de d e ntity C = va lue o f e le c tric ity a t the time in q ue stio n, Ma rke t Re fe re nc e Pric e F

• r wa ste wo o d g a sific a tio n pro je c ts, a c c re dite d b e fo re Ma rc h 2016

A = 2, B fo r April 2016 wa s ~ £41.80/ MWh a nd C wa s ~ £45/ MWh

T he re fore pa yme nt pe r MWh e xporte d = £128.60, 20 ye a r te rm

• Compa re this with the CfD a uc tion strike pric e s in F

e brua ry 2015 of £114 to £120MWh, for g a sific a tion, 15 ye a r te rm

Unlo c king b a rrie rs to de live ry

• Simplify E

nviro nme nta l Appro va ls

• Use e xisting e nviro nme nta l sta nda rds
• L
• c a l c o nse nt fo r pla nning a ppro va ls
• Sta nda rd T

e rms fo r Grid c o ntra c ts fo r inte rc o nne c tio n with e le c tric distrib utio n c o mpa nie s

• OF

GE M c e rtific a tio n a nd mo nito ring o f ROC’ s

• Re ve nue b a c ke d b y lo ng te rm c o ntra c ts (15 -20 ye a rs)

Ove rsig ht o f ROC Susta ina b ility Guide line s a dministe re d b y OF GE M

• F

ue l c la ssific a tio n

• L

a nd Crite ria

• GHG c rite ria
• Ma ss b a la nc e (inc luding supply c ha in)

https:/ / www.o fg e m.g o v.uk/ pub lic a tio ns-a nd-upda te s/ uk-so lid- a nd-g a se o us-b io ma ss-c a rb o n-c a lc ula to r

• Adva nc e d T

he rma l T e c hno lo g y

• Ga sific a tio n
• Pyro lysis
• Pla sma / Hydro g e n Syng a s
• Co mb ine d He a t & Po we r
• Othe r c o ntro lle d the rma l pro c e ss

a pplic a tio ns

Pro mo te d de ve lo ping e me rg ing te c hno lo g ie s

Suc c e ssful Prog ra m in the UK

(E xisting a nd Pla nne d Bioma ss Proje c ts E xc e e ding 5 Mwe )

• Bla c k=Ope ra ting Pla nts
• Re d=Appro ve d Pro je c ts
• Ye llow=Pro po se d Pro je c ts
• Ora ng e =Pro je c ts in

Adva nc e Pla nning

http://www.biofuelwatch.org.uk/wp‐content/maps/uk‐biomass.html

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