Energy Eye – March 2015

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.


Nadeem Arshad

Nadeem Arshad


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    Infrastructure
   Community Energy    Procurement
   Electricity Market Reform    Renewable Heat
   Emissions Trading    Shale Gas
   Energy Efficiency    Smart Metering
   Energy Policy    Sustainable Development
   Feed in Tariffs    Wave and Tidal Energy
   Green Deal    Wind Energy
   Heat Networks  

Carbon Reduction

DECC: Green Hydrogen Standard – Call for evidence: DECC is working with industry to develop a standard for low carbon hydrogen that could help develop a market for it amongst consumers specifically seeking ways of reducing their carbon footprint. This Call for Evidence asks for views on what constitutes ‘green’ in the context of this standard and seeks evidence on the energy system boundary implications, thresholds and technologies the Standard should cover. responses are welcomed from industry, academia, NGOs and any other interested parties. The closing date for comments is 29 March 2015. (13 February 2015)

DECC: Government response to Climate Change Agreements target review 2016 discussion paper and call for evidence: sets out the Government's response to the October 2014 discussion paper that set out proposals for the 2016 Target Review and also invited stakeholders to submit evidence that could be used to inform the review. It announces the Government’s proposed approach to the review in light of the responses. (11 March 2015)

DfT: £3 million green bus funding to help clean up town and city air: announces the award of £3m funding from the Clean Vehicle Technology Fund. The grants have been made to seven towns and cities to fit green technology to existing buses to help improve air quality and create a better environment for residents and visitors. (11 March 2015)

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Community Energy

Green Investment Bank: Business Secretary announces £60m boost for UK community-scale renewable energy projects: gives details of investment in UK community-scale renewable energy projects through Albion Community Power plc. The finance will be used to provide equity funding of between £1m and £10m for a broad range of community-scale renewable construction projects including hydro-power, onshore wind on brownfield sites such as industrial estates, and biogas projects including anaerobic digestion and landfill gas. (17 February 2015)

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Electricity Market Reform

DECC: Electricity Market Reform – Contracts for Difference consultation on changes to the CFD Contract & CFD Regulations: seeks views on a number of proposed policy changes that would require changes to EMR’s secondary legislation to implement. These changes are intended to apply to future (Summer 2015 onwards) CFD allocation rounds. The consultation also includes proposed changes to the CFD contract, covering negative pricing, unincorporated joint ventures and minor, technical or clarifying amendments. The consultation closes on 20 April 2015. (9 March 2015)

DECC: World-leading auctions to provide major green electricity boost: announces the results of the first allocation round auctions for Contracts for Difference, that have led to contracts being offered to 27 renewable electricity projects, which together could power 1.4m homes. (26 February 2015)

DECC: Government response to the Contracts for Difference (Allocation) Regulations – Consultation on non-delivery disincentive exemptions: sets out the Government's response to the September 2014 consultation on changes to the policy that will introduce incentives to prevent early drop out and encourage contract signature and delivery of a CFD. It confirms its intention to implement the Non-Delivery Disincentive policy in amending legislation in accordance with the NDD policy update published on 28 January 2015 in time for a potential 2015 allocation round. (23 February 2015)

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Emissions Trading

DECC: Joint Ministerial Statement on EU Emissions Trading System reform: annunces that nine EU ministers, including UK Energy and Climate Change Secretary Edward Davey, have signed a letter calling for reform to the EU Emissions Trading System through the Market Stability Reserve, stressing the need for all sides to come together to seek an ambitious and pragmatic outcome that has majority support across the EU institutions. (23 February 2015)

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Energy Efficiency

DECC: Cutting the cost of keeping warm – A fuel poverty strategy for England: this strategy builds on the independent review of fuel poverty led by Professor Sir John Hills in 2011. It outlines challenges and actions for the next 15 years to ensure future Governments take the right steps to tackle fuel poverty and get help to those who need it most. At the heart of the new strategy is a new legally binding target to achieve a minimum standard of energy efficiency (Band C) for as many fuel poor homes as reasonably practicable by 2030. It includes a series of pilots focused on priority areas, with £3m funding;  £1m of this will be released immediately to scale up local ‘warmth-on-prescription’ projects to help primary healthcare professionals play a much larger part in tackling fuel poverty. In the coming months up to £2m more will be released to support innovation pilots in other areas. (3 March 2015)

Environment Agency: Comply with the Energy Savings Opportunity Scheme (ESOS): ESOS is a mandatory energy assessment scheme for organisations in the UK that meet the qualification criteria. It applies to large UK undertakings and their corporate groups. It mainly affects businesses but can also apply to not-for-profit bodies and any other non public sector undertakings that are large enough to meet the qualification criteria. Organisations that qualify for ESOS must carry out ESOS assessments every 4 years. These assessments are audits of the energy used by their buildings, industrial processes and transport to identify cost-effective energy saving measures. This guidance sets out qualification, compliance and notification requirements. (17 February 2015)

DH: NHS Energy Efficiency Fund – Final report summary: the NHS Energy Efficiency Fund aims to reduce NHS estate operating costs by investing in selected energy efficiency projects and then reinvesting any savings back into frontline care. This report gives details of the outcomes from 117 energy efficiency projects delivered through 2013 to 2014 in 48 NHS organisations. (25 February 2015)

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Energy Policy

HC Energy and Climate Change Committee: Fuelling the debate – Committee successes and future challenges: this report provides a quantitative overview of the Committee’s work over the last five years and looks in more detail at three case studies – electricity market reform, competition in the energy market and shale gas – where it has played a key role in holding the Government to account and improving policy and legislation. The report goes on to set out the Committee’s future vision for the UK energy system, based on the views and evidence provided by a wide range of energy industry stakeholders. It also explores the challenges which will need to be overcome after the election if the UK is to achieve its ambitious long-term climate and energy goals. It concludes that it is critical that the Government addresses the three challenges of maintaining political stability and leadership, supporting and promoting new technologies, and building consumer trust, if the 2030 vision of a highly decarbonised energy system is to be realised. (12 March 2015)

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Feed in Tariffs

DECC: Feed in Tariffs (FITs) determinations: sets out: the percentage of electricity from each technology deemed to be exported; the value to FITs licensees of deemed export payments; how DECC recompenses licensees’ administrative costs (QFCs); and the collar and cap range for mutualisation payments. These apply to FIT Year 6 (1 April 2015 to 31 March 2016). (27 February 2015)

Ofgem: Feed-in Tariff factsheet – About the scheme and how to apply: provides an overview of the Feed-in Tariff (FIT) scheme, how to apply and where to find out more information. It is intended for those considering to install Solar PV and Wind installations with a Declared Net Capacity (DNC) of 50kW or less or Micro Combined Heat and Power with a Total Installed Capacity (TIC) of 2kW or less. (27 February 2015)

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Green Deal

DECC: £70 million for home energy efficiency through the Green Deal Home Improvement Fund Release 3: announces the third release from the Green Deal Home Improvement Fund (GDHIF), with up to £5,600 available to households in England and Wales to help with the cost of installing certain energy saving measures such as solid wall insulation, double glazing, boilers, cavity wall and floor insulation. The £70m for the third release will be available for applications for solid wall insulation and/or the two measures offer until all the funding is allocated. (4 March 2015)

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Heat Networks

DECC: £3 million funding to boost low carbon heating: announces the 55 local authorities that have been successful in the fourth round of the Heat Networks Delivery Unit funding. The successful local authorities will be offered grants ranging from around £16,000 to £263,000 to help set up their low-carbon heat projects. Grant offers are made subject to compliance with state aid regulations and agreement of a Memorandum of Understanding. There is a list of all successful local authorities, along with guidance and FAQs, on the DECC website. (10 March 2015)

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Green Alliance: Opening up infrastructure planning – The need for better public engagement: this report sets out three fundamental problems with the current state of infrastructure decision making and makes three proposals for how these best be tackled. It calls for a new body, Citizen Voice, to be set up to give cities, counties and the public a say in the biggest infrastructure decisions, and reduce the likelihood that the best projects are delayed by public protest. (24 February 2015)

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Crown Commercial Service: Public Contracts Regulations 2015 – Statutory guidance for contracting authorities and suppliers on paying undisputed invoices in 30 days down the supply chain: this guidance, issued under reg.113 of the Public Contracts Regulations 2015 relates to the payment of valid and undisputed invoices within 30 days. (27 February 2015)

Crown Commercial Service: Public Contracts Regulations 2015 – New requirements relating to pre qualification questionnaires to help businesses access public sector contracts: statutory guidance on qualitative selection for above EU threshold procurements. Contracting authorities must have regard to this guidance for all new procurements that commence from 26 February 2015, when the new regulations come into force. It recommends that all public sector bodies subject to this guidance should adopt the set of standardised selection questions when assessing supplier suitability for providing goods and services. (27 February 2015)

Cabinet Office: Social Value Act review: this review examines how the Public Services (Social Value) Act 2012 has been performing in its first two years. It finds that the Act is having a positive effect where it is taken up, and that it has clear potential to act as a tool for smarter procurement given the right application. The review also makes recommendations around how to further develop the social value agenda and to move the Act into its next phase of implementation. The report includes case studies, practical guidance on how to apply the Act, and a framework and principles for measurement.
The Minister for the Cabinet Office Rob Wilson has written to Lord Young asking him to prevent the Act’s thresholds from increasing to €750,000 for many services when the new Public Contracts Regulations 2015 come into force. (13 February 2015)

Cabinet Office: Procurement Policy Note 03/15: Reforms to make public procurement more accessible to SMEs: guidance on reforms which are implemented in Part 4 of the new Public Contracts Regulations 2015. They include:

  • removing a pre-qualification stage for procurements below the EU thresholds;
  • a requirement for contracting authorities to include provisions to ensure prompt payment through the supply chain; and
  • a requirement to advertise public sector opportunities in one place (Contracts Finder)

The Regulations will, primarily, come into force on 26 February 2015. (18 February 2015)

Bevan Brittan byte size procurement updates: we have published a further two articles in our "byte size" legal updates, in which we look at the new Public Sector Directive and implementing Regulations and deconstruct them into a topic based approach. For each topic we provide a brief explanation of the provisions in the new Directive. We also highlight some of their practical implications. They cover:

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Renewable Heat

Ofgem: Non-domestic RHI guidance: this updated guidance is in two parts. Volume 1 describes the eligibility requirements of the RHI and how applicants can become accredited or registered as applicable. Volume 2 describes the ongoing requirements for RHI participants, information on how periodic support payments are calculated and paid, and our compliance and enforcement powers.
There is also guidance on Fuel measurement and sampling and a Heat loss assessment user guide. (12 February 2015)

Renewable Heat Incentive Scheme (Amendment) (No. 2) Regulations 2015 (SI 2015/477): these regulations, which come into force on 4 March 2015, amend the Non-domestic RHI Scheme regulations (SI 2011/2860) in order to correct an error in reg.42 (periodic support payments to producers of biomethane). (4 March 2015)

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Shale Gas

DCLG: Shale exploration – Support for mineral planning authorities: Invitation to bid: the Government is making £1.2m available to support mineral planning authorities dealing with shale planning applications. This prospectus sets out how mineral planning authorities can bid for funding to improve their capacity and capability to deal with shale planning applications. The fund is designed to provide additional capacity and/or capability support where it is most needed by mineral planning authorities in relation to development proposals involving the boring for, or getting of, oil or gas from shale which: have reached any of the trigger points set out in this document before 31 January 2016; and have yet, in relation to the relevant stage of the planning process, to incur costs associated with the capability or capacity support for which a bid for monies is made. Bids must be received within 28 days of the trigger point being reached, and in all circumstances before 31 January 2016. (5 March 2015)

Non-Domestic Rating (Shale Oil and Gas and Miscellaneous Amendments) Regulations 2015 (SI 2015/628): these regulations, which come into force on 1 April 2015, designate classes of hereditaments in relation to which a billing authority disregards an amount of non-domestic rating income for the purpose of certain calculations under Sch.7B to the Local Government Act 1988 (local retention of non-domestic rates). They provide that when calculating how much rates income in a local authority area is to be shared between local and central government, the rating income from shale oil and gas projects will be disregarded. (9 March 2015) 

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Smart Metering

HC Energy and Climate Change Committee: Smart meters – Progress or delay?: this report scrutinises the progress of the Government’s plan to install smart meters in every UK home and business by 2020. It finds that  the plans are in danger of veering off-track and could prove to be a costly failure because the project has not been driven forward effectively. The Committee raises concerns about technical, logistical and public communication issues which have resulted in delays to the national roll-out programme. (7 March 2015)

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Sustainable Development

DEFRA: Government definitions of sustainability: sets out the Government’s definitions of: sustainable development; sustainability; mainstreaming sustainable development; a presumption towards sustainable development; and sustainable finance. (17 February 2015)

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Wave and Tidal Energy

RenewableUK: Wave and tidal energy in the UK – Capitalising on capability: this report by the Marine Energy Programme Board focuses on the economic benefits and future financing opportunities in the marine sector. It concludes that sustained and consistent practical and financial support from government at all levels is urgently required, if the UK is maintain its global lead and commercialise these industries. By implementing the recommendations in this paper, the UK can set its wave and tidal sectors on an accelerated path towards unlocking long term opportunities and securing medium term outcomes over the next 5-10 years. (26 February 2015)

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Wind Energy

DECC: Hundreds of jobs could be created in Yorkshire and Humberside by a major wind farm: announces that consent has been given for Dogger Bank Creyke Beck A and B wind project that will include up to 400 wind turbines. The project is being taken forward by Forewind, a consortium comprising SSE, RWE, Statkraft and Statoil. it will be based 131km off the coast of Yorkshire, with underground cabling from the beach at Ulrome, to converter stations at Creyke Beck near Cottingham and a further underground connection to a nearby National Grid sub-station. (20 February 2015)

RenewableUK: Subsidies for wind power fourteen times less than people think: reports that a new survey by OnePoll reveals that the UK public think that subsidies for wind power are over 14 times the amount they actually are. Of the 2,000 UK adults questioned, the average estimate was £259 from a typical £1,300 annual domestic dual-fuel energy bill; in fact, subsidies for wind power amount to as little as £18 per household a year. The polling also revealed that over 90% of people underestimate public support for wind power in the UK. The use of wind energy enjoys consistently high popularity ratings of 70%, but those surveyed thought approval ratings were only 40%. (2 March 2015)

RenewableUK: Small and medium wind UK market report 2015: this report examines the current size of the small & medium wind sectors in the UK, provides commentary on the current dynamics of the UK domestic and export market and explores some of the key opportunities and challenges to future market development. (5 March 2015)

Renewable UK: Offshore Wind Programme Board Annual Report 2014: the Offshore Wind Programme Board (OWPB) was set up to remove barriers to deployment and deliver a programme for industry cost reduction in the UK offshore wind sector. It brings together representatives of the offshore wind industry, Government and key stakeholders such as the Crown Estate. The OWPB is tasked with delivering on the five priorities of the Offshore Wind Industry Council, set up as part of the Government’s wider industrial strategy. This annual report sets out the significant progress made by the OWPB towards its objectives of removing barriers to the deployment of offshore wind, facilitating growth of a competitive UK industry and delivering cost reduction. The publication of the first results from the offshore wind cost reduction monitoring framework shows clearly that the cost of energy is falling, and this is very welcome. The OWPB expects this trend to continue over time and for the gap between cost of energy and support levels to continue to narrow. (5 March 2015)

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