At a recent renewable conference in London, director of clean electricity for the Department of Energy and Climate Change (Decc) Michael Rutter said the department had held a series of meetings with independent generators and utilities to discuss how a so-called ‘subsidy-free’ CfD for small-scale projects and tidal power might work.
A ‘subsidy-free’, or ‘market stabilising’ CfD is a new form of limited subsidy being mooted for mature renewables technologies such as onshore wind. It would offer a limited amount of government support, and circumvent EU rules on State Aid.
Rutter said: “Ministers have made it clear to us that it’s an idea that they are interested in. The next stage for us will be to pull together the advice that we’ve had so far from discussions with the industry and go back to our Ministers and seek a steer from them about how they want us to pursue this over the next few months… that’s not just Ministers within Decc, that’s Ministers across government.”
A Decc spokesman told Utility Week: “It’s a normal part of government business to examine a range of proposals that are put to us by external stakeholders, but no decisions have been made.
“We have been clear that subsidies should be temporary, not part of a permanent business model, and we will continue to be tough on them, so that we keep bills down for our families and businesses and ensure value for money.”
Also speaking at the conference, Sustainable Marine Energy commercial director Christoph Harwood highlighted that tidal developments of around 3MW face difficulties: “The CfD regime is designed for large offshore and onshore wind. They’re not designed for tidal development of a 3MW site and that is a problem because if we want to rollout 1MW at a time or add 1MW to a site, we have a problem.
“All the other sectors got feed-in tariffs for small sites. So one of the gaps in policy is the right revenue support for small-scale developers in wind and tidal.”