Speaking in front of the Energy and Climate Change Committee (ECCC), the head of the renewables programme team at the Department of Energy and Climate Change Gareth Redmond said there has been a “pre-action protocol letter” received in relation to the changes to the FiT pre-accreditation, a measure designed to give subsidy certainty for renewables projects in the early stages of development.
“There is a conversation between lawyers going on,” he added.
Energy minister Andrea Leadsom said that although there could be legal action, the department is confident that it has done its due diligence over the proposed changes.
“We looked at it from every angle including a legal angle,” she said. “We’re sure this is fair and the right balance between bill payers and developers. Just because someone may challenge it doesn’t mean it isn’t fair.”
During the hearing Leadsom admitted that investor confidence in the UK energy sector has been hit due to the “policy reset” Decc is currently undertaking.
She told the committee: “The policy reset process is always going to lead to a period of uncertainty. What we are trying very hard to do is constrain that to as short a time as possible
“We have to ensure as soon as we possibly can that we come out with complete investor certainty and that’s what we’re trying to do. It is absolutely key.”
The energy minister, when questioned by ECCC chair Angus MacNeil on the success of the capacity auction, also suggested the regime could be changed to ensure the UK has “guaranteed energy security”.
Leadsom stated: “We are holding the second auction soon and we do believe it will bring forward new gas plants. If it doesn’t we may have to tweak the auction to make sure it does.
“Energy security is crucial and what the capacity auction does is stimulate the growth of gas.”