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Small-scale renewable electricity schemes could generate more than twice the output of Sizewell B nuclear power station by 2020 if Ministers improve the proposed Clean Energy Cash-back scheme (or feed-in tariff), due to be launched in April next year, according to figures released today (Monday, 30 November 2009) by Friends of the Earth.
The environmental campaign group used figures obtained from the Government to show that introducing a more ambitious scheme than that currently proposed would only add an average £2.37 per year on to household electricity bills over the next four years - just £1.20 a year more than the Government is already proposing to add to fund the scheme.
The figures are published as 30 organisations and businesses - including Friends of the Earth, the Renewable Energy Association, The TUC, British Retail Consortium, the Co-operative Group, Country Land and Business Association (CLA), the Federation of Small Businesses, Unison and WWF - have written to MPs urging them to support an Early Day Motion (EDM 276) tabled by Alan Simpson MP calling for a much greater level of ambition for small scale renewable electricity generation than the Government scheme currently proposes.
Friends of the Earth, which led the campaign to introduce a feed-in tariff alongside the Renewable Energy Association, has criticised the proposed scheme as lacking ambition because it only aims to generate two per cent of UK electricity from small-scale renewable technologies by 2020. The group accuses the Government of ignoring the results of research commissioned by DECC which shows that setting the scheme to deliver a 10 per cent annual return on investment (instead of the 5-8 per cent currently proposed) for communities, businesses and households that install renewable electricity technologies would:
· Deliver over 6 per cent of UK electricity generation (equivalent to the output of Drax coal-fired power station, or twice that of Sizewell B) by 2020 - three times the Government's current target;
· Reduce UK dependency on fossil fuels and increase energy security;
· Cut UK emissions by 9.9 million tons of carbon dioxide annually by 2020.
Friends of the Earth is calling for the proposed tariffs to be increased to deliver an annual 10 per cent return for all small-scale green energy schemes installed during the first three years of the scheme (the payment system is due to be reviewed in 2013). After this payments could be revised for new schemes as other measures are introduced, the UK renewable energy market grows and global fossil fuel energy prices rise - while maintaining the higher level of overall ambition.
Friends of the Earth's energy campaigner Dave Timms said:
"Small-scale green energy systems such as solar panels on homes and businesses and community-owned wind turbines could play a crucial role in cutting UK emissions and speeding us towards the development of a low carbon economy.
"But the Government's proposed Clean Energy Cash-back Scheme is far too weak - Ministers must increase payments to make it a success.
"A tiny addition to UK electricity bills would kick-start a world class scheme that would allow homes, businesses and communities to play their part in tackling climate change, increasing energy security and creating thousands of new green jobs.
"The UK's renewable energy potential is enormous. As the world prepares for crucial climate talks in Copenhagen, the Government must show that it is taking this issue seriously and improve its plans to pay people for generating their own clean, green power."
Notes to Editors:
1. Friends of the Earth campaign for a feed-in tariff won "renewable energy advocate of 2009" at the British Renewable Energy awards: http://www.foe.co.uk/resource/press_releases/energy_bill_18112008.html
2. The table below shows the annual costs to all consumers (businesses and households) for the Government's proposed scheme (or "Lead Scenario") and the scenario of tariffs calculated to give a return on investment (ROI) of 10% that campaigners are demanding until the first review in 2013. The figures are discounted 2008 prices, i.e. future prices discounted at 3.5 per cent per year.
Annual costs to consumers (discounted 2008 £m)
Year 2010 2011 2012 2013 Total
Lead scenario: £22 £57 £109 £169 £358
10% ROI: £55 £124 £216 £330 £725
These are previously unpublished figures released to Friends of the Earth by DECC and consultancy Element Energy. DECC assume that households bear 34 per cent of the total cost of the scheme.
Assuming 26m households this means that by 2013 households will be paying on average an addition to their electricity bill of £4.31 a year to pay for an enhanced Clean Energy Cash-back scheme FITs, compared with an additional £2.21 under the current proposals. This means that setting tariffs based on a 10 per cent ROI until the first review in 2013 would raise the cost of the average household bill by just £2.10 more than is already proposed by DECC.
In the years to 2013 the addition to bills would be much less, making the average cost to consumers of a 10% ROI over the 4 year period just £181.25m annually or £2.37 per household per year (assuming 26m households by 2013). The average addition above the cost of the proposed scheme is £91.75m to all consumers annually or £1.20 per household per year over the period between 2010 AND 2013.
3. According to the modelling commissioned for DECC from Poyry and Element Energy tariffs set to deliver a 10% ROI would result in 25TWh of small scale renewable electricity generation by 2020. It would do so more cost effectively than tariffs based on a lower rate of return. This is the equivalent of the output of Drax power station (25.4TWh in 2008) or two and a half times the output of Sizewell B (9.8TWh in 2008).
4. A copy of the letter to MPs and a list of signatories is available from Friends of the Earth.
5. Friends of the Earth is part of Stop Climate Chaos Coalition, the UK's largest group of people dedicated to action on climate change and limiting its impact on the world's poorest communities. The coalition's supporter base of more than 11 million people spans over 100 organisations, from environment and development charities to unions, faith, community and women's groups. Together we demand practical action by the UK to keep temperatures well below an average two degree rise. For further information visit http://www.stopclimatechaos.org/