This Update contains brief details of Government and EU publications, legislation, cases and other policy developments in England and Wales relevant to those interested in energy, renewables, energy efficiency and the alternative energy sector, which have been published in the past month.

Items are set out by subject, with a link to where the full document can be found on the internet. All links are correct at the date of publication.

If you have been forwarded this update by a colleague and would like to receive it direct please email Claire Booth.

The following topics are covered in this update:

   Carbon Reduction    Heat Networks
   Climate Change    Smart Metering
   Electricity Market Reform    Solar Energy
   Energy Efficiency    Wave and Tidal Energy  
   Green Deal  

Carbon Reduction

DfT: Green buses to get more funding: announces additional £3.4m funding from the Clean Bus Technology Fund  to bring 55 more low carbon buses into service and to retro-fit dozens more to clean up their exhaust fumes. The grants will enable bus companies and local authorities in Manchester, Oxfordshire, York and Sunderland to buy electric, hybrid and biomethane gas-powered buses; Swale, Sheffield, the West Midlands, Chiltern and York have been awarded funds to modify local buses to reduce emissions of harmful pollutants and improve air quality on congested roads. (2 October 2013)

Environmental Audit Committee: Progress on carbon budgets: the Government is required to set a series of five-year carbon budgets to restrict greenhouse gas emissions so that the UK's longer term statutory climate change targets are met. Four carbon budgets have been set covering the period up to 2027. This report examines whether the emissions restrictions in the carbon budgets are still valid as an appropriate UK contribution to tackling climate change, in light of recent climate science. It finds that the UK's existing carbon budgets represent the minimum level of emissions reduction required to avoid a global 2 degrees temperature rise - regarded as a dangerous threshold - and that the UK's leading climate scientists did not believe loosening the budgets was warranted by the science. The report warns that arrangements for managing and reporting progress against carbon budgets have not been working properly. The Government's Carbon Plan - which set milestones for five key Government Departments to cut carbon - is out of date. Quarterly progress reports against milestones have not been published as promised and current departmental business plans are not aligned with the plan.
It calls on the Government to: commit to not-loosening the fourth carbon budget; identify when it will come up with key policy initiatives to bridge this gap and reduce emissions in the non-traded sector in the fourth carbon budget; and state how it plans to strengthen the EU ETS in conjunction with the European Commission. (8 October 2013)
See also the Government's response to the report which restates its commitment to meeting the targets set out in the Climate Change Act and the carbon budgets. (10 October 2013)

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Climate Change

DECC: IPCC report – Key points and questions: the UN’s Inter-Governmental Panel on Climate Change (IPCC) published the first volume of its 5th Assessment Report on The Physical Science Basis of Climate Change on 27 September 2013. Its assessment of the state of the climate is the most comprehensive ever written and provides a strengthened body of evidence of man-made climate change since its last major review almost six years ago. It finds that climate change is happening now and greenhouse gas emissions from human activities are the dominant cause. Climate change will continue over the decades and centuries to come in the absence of significant emission reductions. This note summarises the report's key findings. (2 October 2013)

HMRC: Electricity from renewable sources (Notice CCL1/4): this updated notice explains when supplies of electricity generated from qualifying renewable sources are exempt from the climate change levy (CCL), and the procedures involved in applying the exemption. It replaces the May 2012 notice. (9 October 2013)

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Electricity Market Reform

DECC: Proposals for implementation of Electricity Market Reform: seeks views on the detailed proposals for the implementation of Electricity Market Reforms (EMR). The documents set out implementation proposals for the key mechanisms for reform, the Contracts for Difference and Capacity Mechanism, as well as the institutional and transitional arrangements. It also seeks views on implementation of measures to manage any potential conflicts of interest for National Grid as the EMR delivery body. There is also a package of draft secondary legislation. The consultation closes on 24 December 2013.  DECC aims to publish the Government response and to lay the final regulations in Parliament in Spring 2014, and for the regulations to become law in Summer 2014. (10 October 2013)

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Energy Efficiency

DECC: Reducing energy demand: announces a new Energy Demand Reduction (EDR) scheme that will enable British businesses and other organisations to receive financial incentives for reducing the amount of electricity they use. The new £20m pilot will examine how businesses and other organisations that install measures like more efficient motors, air conditioning and lighting could receive financial incentives for the reduced amount of electricity they use. Under the EDR pilot scheme, an auction will be set up where organisations based in Great Britain can bid using the electricity savings they can offer and the price they are willing to accept to deliver these savings. The EDR pilot is expected to open for bids in Summer 2014 and to run for around two years. (15 September 2013)

DECC: Warm Home Discount – Flexibility for higher spending: the Warm Home Discount scheme provides energy bill rebates to low income and vulnerable households in Great Britain. This paper seeks views on a proposal to amend the scheme regulations so as to allow participating energy suppliers to spend up to 34% more this year on their non-core spending than the £100m they have been instructed to spend in total and, by spending more, to reduce their non-core spending obligation for 2014/15. This measure is intended to result in more fuel poor households receiving assistance under the scheme this year. It does not introduce new requirements but allows suppliers to help more households while also helping to reduce delivery risks. The consultation closes on 25 October 2013. (30 September 2013)

DECC: 2013 Home Energy Conservation Act (HECA) reports: DECC has published all the local authority reports under the Home Energy Conservation Act 2005 that it has received. The reports set out the energy conservation measures that each authority considers practicable, cost-effective and likely to result in significant improvement in the energy efficiency of residential accommodation in its area.
There is also a spreadsheet with an analysis of these reports. It can be used to see an outline of an authority's plans for Green Deal, ECO and fuel poverty activity, local targets such as CO2 reduction, information on housing stock data, activity planned on FITs/RHI, details on planned area-based approaches, an outline of partners and details of co-funding where appropriate. 
(10 October 2013)

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Green Deal

DECC: Green Deal assessment survey wave 2 – Summary report: summarises the findings from the second wave of research by GfK NOP which surveyed a sample of households who had had a Green Deal Assessment in order to find out more about the experience and what households had done and planned to do since having the assessment.  This report focuses on those who had a Green Deal Assessment between 1 April and 30 June 2013. The findings show that, from a sample of households that had a Green Deal assessment:

  • 81% of households have already, are in the process of or intend to install at least one energy efficiency home improvement;
  • 56% of households have already installed at least one measure;
  • a further 6% are in the process of having instalments; and
  • 19% said they intend to have something installed.

(17 September 2013)

DECC: Green Deal case studies: DECC has published a number of case studies from around the country showing how the Green Deal is making a difference to homes and lives. (19 September 2013)

DECC: Green Deal branding guidelines: guidance on the Green Deal Quality Mark, which must be used by all Green Deal Assessors, Providers, Installers and Certification Bodies on identifying documents and any marketing material. The Quality Mark is trademarked by the Secretary of State for Energy and Climate Change and therefore may only be used under and in accordance with a Green Deal Quality Mark licence issued by, or at the request of, the SOS. Every Green Deal Participant’s Quality Mark licence requires compliance with these guidelines. (19 September 2013)

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Heat Networks

DCLG: £6 million funding for local authority heat networks: announces a new £6m grant funding programme, managed by DECC's Heat Networks Delivery Unit, to help local authorities in England and Wales to achieve urban decarbonisation, local growth, improved energy efficiency and reduced fuel poverty through increased use of heat networks. The grants will support plans for networks that draw their heat energy (immediately or in the future) from renewable, sustainable or recoverable sources as an alternative to or to complement gas CHP. The fund will meet 67% of the estimated eligible costs of specialist consultants used to develop technical proposals and financial evaluations; applicants will need to contribute the remaining 33%. There will be six bidding rounds until March 2015. The closing date for Round 1 applications is 15 November 2013, and for Round 2 is 24 January 2014. More details are given at the bottom of the Heat Networks web page. (20 September 2013)

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Smart Metering

DECC: Award of Smart Meters DCC licence: announces the four companies that have signed contracts to establish and operate the Data and Communications Company (DCC) providing the shared infrastructure for energy suppliers to roll out 53m electricity and gas smart meters by 2020:

  • DCC licence: Capita plc;
  • Data Service Provider contract: CGI IT UK Ltd;
  • Communications Service Provider contract for the North: Arqiva Ltd;
  • Communications Service Provider contracts for the Centre and South: Telefónica UK Ltd.

(8 October 2013)

DECC: The Smart Metering leaflet: a new shared Smart Metering national infrastructure comes into place in late 2015. This leaflet explains how the system will work. It illustrates the main parts of the smart metering systems showing the equipment and communications within energy consumers’ homes. It also shows the organisations that will use the information provided by smart meters (DCC Service Users), and the system provided by the Data and Communication Company (DCC) which will link these organisations with the smart meters. (8 October 2013)

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Solar Energy

DECC: UK solar PV strategy Part 1 – Roadmap to a brighter future: sets out the Government's vision for the future of solar PV, with four guiding principles that form the basis of the strategy for solar PV – support for solar PV should:

  • allow cost-effective projects to proceed and to make a cost-effective contribution to UK carbon emission objectives in the context of overall energy goals;
  • deliver genuine carbon reductions that help meet the UK’s target of 15% renewable energy from final consumption by 2020 and in supporting the decarbonisation of the economy in the longer term;
  • ensure proposals are appropriately sited, give proper weight to environmental considerations such as landscape and visual impact, heritage and local amenity, and provide opportunities for local communities to influence decisions that affect them; and 
  • assess and respond to the impacts of deployment on grid systems balancing, grid connectivity and financial incentives. 

The roadmap confirms that new solar PV installations will need to be appropriately sited, give proper weight to environmental considerations such as landscape, heritage and local amenity, and provide opportunities for communities to influence decisions that affect them. The impacts of deployment on grid systems balancing, grid connectivity and financial incentives will also have to be considered, ensuring the challenges of deploying high volumes of solar PV are addressed. It covers what has been done to date, and where further work is needed. The finalised Solar PV Strategy will be published in Spring 2014. (8 October 2013)

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Wave and Tidal Energy

HC Energy and Climate Change Committee: A Severn Barrage? Government Response to the Committee's Second Report of Session 2013–14: on 10 June, the Committee published the report of its inquiry that examined the proposal from Hafren Power Ltd for an 18km fixed tidal barrage between Brean in England and Lavernock Point in Wales. The Committee concluded that while a tidal barrage could offer decarbonisation and energy security benefits, the Hafren Power project in its current form had not demonstrated sufficient value as a low-carbon energy source to override regional and environmental concerns. This report sets out the Government's response to the Committee's comments and recommendations. It states that the Government remains keen to hear about well-developed proposals for harnessing the power of the Severn estuary, be it through a barrage or other means. However any such scheme would need to credibly demonstrate strong evidence of value for money, economic benefits, energy saving and environmental impact mitigation before the Government could take a view on its potential. (10 September 2013)

Welsh Government: Crown Estate announcement is welcome news for Welsh marine energy industry: the Welsh First Minister, Carwyn Jones, has welcomed a Crown Estate's announcement that will support Wales in its ambition to become a world leader in renewable marine energy. The Crown Estate has identified areas of water off the UK coast suitable for testing and demonstrating wave and tidal energy projects.  Up until now leases have only been granted to single projects, but the recent announcement means that developers can now apply to manage multiple projects in the newly-identified ‘zones’. The application process is now open for projects and interested parties to manage the zones, which have been identified based on the suitability of their physical characteristics. (4 October 2103)

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