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Tag Archives: DECC
23 October 2015: The Mayor has posted his submission to DECC’s Feed in Tariff (FIT) consultation online today (the deadline for the response) alongside a letter to Energy Minister Andrea Leadsom, from Deputy Mayor for Energy & the Environment, Matthew Pencharz.
The letter pulls no punches, stating “Unfortunately, the proposals that have been consulted on, with little or no prior warning, to come into force, in the new year has created great uncertainty in the solar PV industry, potentially putting at threat thousands of jobs across the UK. The Mayor is concerned about the potential impact on the 3,100 jobs, mainly in SMEs, which make up the solar PV industry in London.”
“The Mayor’s view is that in order to ensure an orderly transition to subsidy-free solar PV industry, there should be a gradual tapering of the FIT over a two-three year period.”
The Mayor has voiced his concerns over DECC’s proposals for some months now (see previous statement here) and his sentiments for a ‘gradual tapering’ echo calls from industry organisations, such as the Solar Trade Association, who have strongly campaigned against the proposed ‘cliff edge’ withdrawal of support for solar, setting out their own recommendations in a ‘£1 plan‘ to 2019.
The Mayor’s response to the FIT consultation goes on to raise a number of highly relevant issues for London, including:
- the proposed cuts to the FIT could significantly hamper solar PV deployment rates in London, which already face major rollout challenges, including negatively impacting upon the delivery of Mayor’s retrofit programmes, RE:NEW and RE:FIT
- the proposed tightening of the energy efficiency criteria would prevent a large number of properties in London from installing solar PV without significant investment in energy efficiency improvements, for which there is no longer support available following the termination of the Green Deal
- whilst a move towards smart metering with net metering functionality is welcome, making it a requirement for receipt of the export tariff would require a commitment or obligation on the energy suppliers to install a smart meter in a timely manner, as well as ensuring that the property was currently suitable for installation of a smart meter – an issue which arises frequently in London.
The Mayor’s response also raise concerns about the impact of the proposals on community energy projects in London. All in all, this is a significant intervention by the Mayor in what has become a highly politicised consultation.
At a recent DECC FIT workshop, officials have said they are looking to respond to the consultation by late November/early December (this is needed as the consultation proposes to introduce changes to the FIT programme as early as January 2016!). With the number of responses predicted to be in the thousands (the shorter-run FIT pre-accreditation consultation had over 2,000 responses), and with the threat of major job cuts in the department, it looks like it’s going to be a busy few weeks over at 3 Whitehall Place…
20 September 2015: Tangential – but interesting to note the following story in today’s Sunday Times: “Whitehall energy HQ sold – The Grade II-listed building that houses the Department of Energy & Climate Change in London has been sold in an £80m deal. LaSalle Investment Management, part of the American property giant JLL, bought the site just off Whitehall from Aberdeen Asset Management last week. Nick Howitt of LaSalle said the area was improving, thanks to the regeneration of nearby Covent Garden and Victoria.”
November 2014: DECC have announced the new Urban Community Energy Fund – (UCEF) – trailed earlier this year in the government’s Community Energy Strategy – is now open to applications. The fund provides:
- a £10m fund to kick-start renewable energy generation projects in urban communities across England
- Grants of up to £20,000 for the more speculative, early stages of a project’s development, such as public consultation and preliminary viability studies.
- Loans of up to £130,000 to develop planning applications and a robust business case to attract further investment.
Full details – including an eligibility checker for organisations can be viewed here.
CSE and Pure Leapfrog are running a free one-day surgery in London for community groups, which aims to get them ready to make an application to the Urban Community Energy Fund. The event runs from 10am – 4pm on Monday 15 December at the Directory of Social Change.
June 2014: DECC have issued a tender to appoint an administrator for their recently announced £10m Urban Community Energy Fund (details of which are outlined in an earlier post here). The tender seeks to procure a contractor to set up and manage the Fund until 2018, with the possibility of an extension, and sets out a list of requirements including:
- The contractor will be required to develop a mechanism for administering the repayment of loans from the Fund
- Should have ability to provide advice to applicants to the Fund
- Show an understanding of the energy technologies covered by the Fund
- Develop a digital service (website) for users of the Fund
- Develop supporting material, for example application forms, for the Fund
- and do all this to in time for the Fund go-live in September 2014 [with the Fund likely to be launched by Ministers at the Local Authorities and Communities Conference organised by DECC and Oxford City Council, which is to be held on 4 September. This conference will be followed by the Community Energy Awards – details here].
- The deadline date for organisations to apply to the tender is 21 July 2014.
The tender sets out that applicants to the Fund will need to:
- Show the organisation is a community group as defined within the fund (the exact criteria of which is to be confirmed); and
- Submit a business case related to the project that are requesting funds for, with this business case to be assessed by the fund administrator.
A recent presentation by the Head of DECC’s Community Energy Team (at an event held on 11 June launching the results of the Kingston smart communities project) provides some additional background to work being undertaken to support the uptake of community energy.
June 2014: The Mayor has responded to a three questions this month on the Government’s recent Community Energy Strategy stating that:
- “I welcome the publication of the Strategy and the establishment of the Community Urban Energy Fund and will look at how, through our existing programmes and activities, we could support London based organisations to access the scheme.”
- He will consider how the London Energy Efficiency Fund (LEEF) can potentially compliment the Community Energy Strategy’s Urban Energy Fund
- His advisor and officers have already started meeting a few community energy groups operating in London.
The government’s £10m Urban Community Energy Fund (UCEF) will provide up to approximately £150,000 of funding for feasibility and pre-planning development work to help projects become investment ready. The funding will be available in two stages:
- Stage one will be a grant of up to approximately £20,000 for feasibility of renewable energy projects.
- Stage two will be a loan of up to approximately £130,000 to support pre-planning development work, planning applications and to develop robust business cases to attract further development.
Details of the Fund have as yet not been fully announced by DECC as yet, but a new Community Energy Unit has been established in DECC and will be leading on its delivery.
January 27 2014: The Government’s new Community Energy Strategy is being launched today and press reports have highlighted that it will include a new £10m Urban Community Energy Fund (UCEF). This mirrors the existing Rural Community Energy Fund, and is clearly welcome news for London-based community-led energy projects.
This fund will be open to non-rural communities and will provide up to approximately £150,000 of funding for feasibility and pre-planning development work to help projects become investment ready. The funding will be available in two stages:
- Stage one will be a grant of up to approximately £20,000 for feasibility of renewable energy projects.
- Stage two will be a loan of up to approximately £130,000 to support pre-planning development work, planning applications and to develop robust business cases to attract further development.
No details as yet to when the Fund will be launched or how long it will operate for. Hopefully this will all become apparent later today…
1 December 2013: …is not anywhere on Number 10 or DECC’s websites but behind a ‘paywall’ in today’s edition of the Sun on Sunday. But is now also reproduced below:
Cameron: We can help the poorest and stick to our green policies
Coalition on pledge to keep energy bills down
By DAVID CAMERON, Prime Minister, and NICK CLEGG, Deputy Prime Minister
LABOUR leader Ed Miliband rocked Westminster with his pledge of a 20-month freeze on energy bills.
While ministers scoffed it wouldn’t work, they were stung by its popular appeal with voters.
Now after two months of head-scratching, they have come up with an alternative plan to keep prices down.
Here the Prime Minister and his Lib Dem deputy reveal plans to slash £50 off the average bill – and explain how they’ll do it:
BECAUSE of the hard work of the British people, and because we have stuck to our long-term economic plan, Britain’s economy is now on the mend – and we’re determined to help families in every way we can.
The Coalition is offering real help in these hard times: income tax cuts, a council tax freeze, a fuel duty freeze and free school meals for young children.
We have only been able to do this because we have taken difficult decisions and our economic plan is working.
This week, we will announce further help: proposals that will be worth around £50 on average to energy bill-payers.
We’re doing it without taking any help away from poor families or sacrificing our green commitments; and in a way that will keep Britain’s lights on in the long-term too.
When you look at your bill you see it is made up of various costs. Some of these we can’t control.
Most of what you pay is determined by the price of energy in the global market – the gas and oil we’re buying from the Middle East or Europe.
Politicians in the UK cannot wave a magic wand over these prices. To pretend you can is fantasy politics.
But there are bits that government can control – the parts of your bill that go to helping the poorest families heat their homes and to making Britain more energy efficient.
Some say we should drop these commitments entirely but we do not agree. As we approach winter, we refuse to turn our backs on the worst-off families. And if we abandon our green commitments, it is our children and grandchildren who will pay the price.
This Coalition Government has never pursued quick fixes today when they’ll hurt people tomorrow – and we’re not going to start now.
So we are going to stick to these commitments but we are not going to ask you to pay for all of them through your bills.
The two million poorest families who currently receive a discount on gas and electricity will continue to do so, but Government will pay for it. We’re able to afford this because we have cracked down on tax avoidance – leaving us more money to help struggling families. We are also changing the way we fund improving energy efficiency in Britain’s homes.
We will all be better off when our homes lose less heat, so we want the energy companies to help insulate as many homes as possible over the next decade.
But – apart from in the worst-off homes – we’re going to spread the costs of these programmes over a longer time frame, reducing people’s bills.
And to make sure we carry on cutting enough carbon, the Government will pay for new incentives for people to insulate their homes.
Alongside the Green Deal, when you buy a new home you could get up to £1,000 from Government to spend on energy-saving measures – equivalent to half the stamp duty on the average house – or even more for particularly expensive measures.
It is an all-round win. Better insulation means cheaper bills, it will cut carbon emissions and boost British businesses who provide these services.
On top of that, we will offer cash incentives to landlords of the least energy-efficient properties so that, when they are between tenants, they can better insulate their properties. And we’ll also make sure our schools and hospitals are more energyefficient, too.
Taken together, these things mean we will meet our green commitments and support those employed in the insulation industry but, crucially, without putting the cost on energy customers.
Labour have promised a temporary price freeze on energy bills. But they’re taking people for fools. Energy companies would hike up prices both before and after the freeze – so families would end up paying more.
Not only that, by cutting investment in green energy, their freeze would threaten thousands of jobs.
Labour’s con is the worst of all worlds. When an offer sounds too good to be true it usually is.
The Coalition has come up with a serious and credible plan that actually works.
By taking the time to get this right, we’ve got the best outcome all round. No poor family will lose a penny of help.
Our clean energy sector will get the investment it needs, the lights will stay on and we will cut just as much carbon as we planned.
Instead of a fake giveaway, we’ve found another way to support Britain’s hard-pressed families when they need it most.
October 2013: Interesting to see the GLA have recently approved funding to commission “external consultants to collect evidence of barriers experienced by developers in obtaining timely and cost efficient connections to London’s electricity distribution infrastructure, model the economic impact of the current barriers and advise on options for removing them.” Similar issues, along with questions on the suitability of the regulatory framework governing investment into London’s electricity networks, were highlighted in a letter from the Mayor to energy Secretary of State, Ed Davey, released a few weeks ago.
October 2013: In the most recent of his weekly columns in the Daily Telegraph, the Mayor relates a story of a meeting he had with Labour leader Ed Miliband a few years ago, when Ed was the Secretary of State for Energy and Climate Change. The Mayor’s account is in part a response to the announcement Mr Miliband made at last week’s Labour Party Conference that, if Labour were to come into government after the 2015 general election, they would enact a 18 month ‘energy price freeze’ on energy company tariffs.
The Mayor account prove interesting reading: “I don’t think I have ever told you about my last official meeting with Ed Miliband. I must have somehow blanked it out, as one of those experiences that is just too harrowing to relate. It took place a few years ago, and my City Hall team was very excited in the run-up. We had an absolute corker of a plan, you see. We had the spreadsheets, the data, the options – and all we really needed was for Government to get behind it, and make sure that London got its fair share of the funding.
“We were going to launch a huge drive to improve the energy efficiency in the capital’s homes. We were going to hit all sorts of nails pretty smartly on the head: we were going to cut CO₂ emissions, and thereby stop the polar bears from plopping off the ice floes. We were going to cut NO₂ emissions from our noisome old boilers, and so improve air quality. We were going to help get thousands of people into work as retro-fitters – people who went around helping to insulate homes.
“As I told my team during the preparations, Britain might be lagging in some respects, but once our programme was under way we would certainly not be lagging in lagging. Above all, we were going to achieve the number one objective of the scheme: we were going to help cut the cost of heating people’s homes and help stabilise fuel bills.
“I was interested in the plan as a way of helping the planet and helping people in tough times. As for Ed – well, it was, frankly, a bit disheartening. He wasn’t remotely interested. He didn’t want to talk about retro-fitting and, as I gabbled away about a new legion of “boiler bunnies” bouncing up to your door, I was aware that a deep tranquillity had settled on the minister.
“He didn’t want to talk about cutting the cost of living. He just wanted to trade jokes about the forthcoming general election; and as one of my team put it later: “He was only vaguely in command of his brief and had no interest in achieving anything.” We wrote a long and optimistic follow-up letter, hoping that perhaps he had been taking it in. Nada. Not a peep.”
It would be great to read a response from the Labour leader of his account of this meeting…but it seems unlikely that one will be forthcoming anytime soon. It is true that national governments – of all political persuasions – have neglected to provide the tools to London-government to exploit in full its carbon-saving and sustainable energy potential. And a recent letter from the Secretary of State for Energy to the Mayor suggests a similar indifference continues today…
September 2013: The Mayor’s concerns over “uncertainties of our energy supply and growing chances of supply disruption in the coming years” have been highlighted in correspondence between Boris Johnson and Ed Davey, the Secretary of State for Energy and Climate Change, Ed Davey, released this week.
The Mayor writes that his “priority is delivering the jobs and growth that will ensure London remains the best big city in the world in which we live, work and invest, and having a secure energy supply will be absolutely crucial to achieving this… I am adamant that we must do everything in our power now to ensure that the lights will stay on in the future.”
The Mayor calls for major changes to the regulatory control framework rules for distribution network operators (DNOs). As these are predominantly monopoly businesses, the operating framework is set by energy regulator Ofgem. DNOs are the companies operating the local electricity grid (as opposed to the higher voltage ‘national transmission grid’) and in London the majority of the distribution network is managed by UK Power Networks and parts of west London by Scottish & Southern Energy. The Mayor letter calls for a “urgent review of the currently regulatory regime to ensure that DNOs are able to invest in energy infrastructure and install capacity ahead of need”.
The Mayor highlights problems with current legislation and – interestingly – points to “the way Ofgem interprets and exercises its regulatory functions [which] are not fit for purpose” and finally calls upon the Secretary of State for ideas on how to give “DNOs in London substantially more scope and flexibility to reduce the level of network stress and improve strategic investment in London’s electricity infrastructure.”
In response to the tightening of electricity supply capacity over the next few years Ed Davey refers to possible extensions to existing balancing services operated by National Grid and in the “medium term …steps to ensure sufficient investment in capacity via the Capacity Market, with the first auction taking place in 2014 for 2018/19 delivery.”
On the issue often brought up by businesses – the speed of installing electricity connections to new users – the Minster’s letter touches upon current Ofgem work to set the new electricity distribution price control (called RIIO ED1) and sets out that “the existing framework provides the flexibility to drive efficiency outcomes in the vast majority of cases.”
The Mayor’s correspondence with Ed Davey is set out in Appendix 6a of the following GLA document.
The Mayor has established a ‘High Level Electricity Working Group’ to look at many of the issues raised above and minutes and papers from the three meetings that have taken place to date of this group can be found here. A further recent paper looking at London’s electricity infrastructure by the London Infrastructure Group can be viewed here.
July 2013: DECC’s recent publication ‘Summary evidence on District Heating Networks in the UK’ highlights that extent that London dominates the regions in relation to the use of district heating. The report sets out that “London has over half the heat networks in the UK (55%) with two thirds (65%) being small”. Table 5 from the evidence paper (copied below) provides some additional detail:
To take forward the Government’s 2012 Future of Heating Strategy, a series of actions were set out in a further report published earlier this year – The future of heating: meeting the challenge which includes a major chapter on heat networks. Not suprisingly, London is featured prominently with examples of recent activity on developing decentralised energy networks in Islington, the Upper Lea Valley, the Olympic Park and Stratford City, as well as the heat network installed in The Shard.
The report also highlights how work is being coordinated in London through the DEPDU initiative. Page 55 sets out “in September 2011 the GLA established the Decentralised Energy Project Delivery Unit (DEPDU) to support the London boroughs in bringing forward plans for decentralised energy. The unit, which is staffed by technical, financial and commercial specialists,has focused primarily on developing heat network projects.”
DECC are now seeking to replicate this model through the creation of HNDU. The ‘meeting the challenge’ paper states that “DECC will support local authorities in developing heat networks by establishing a Heat Networks Delivery Unit (HNDU) within the Department that will work closely with individual authorities’ project teams in England and Wales. DECC will provide funding over two financial years to contribute to local authorities’ costs in carrying out early stage heat network development. This will enable local authorities to bring forward projects to the stage where they are suitable for investment including loan finance from the Green InvestmentBank or commercial lenders.” [p38]
£3m over two years will be committed to HNDU to provide specialist expertise and be a “bridge between the local authority and the market, acting as a ‘critical friend”. The unit will also have a “funding stream of £6m over two years [which] will be available to local authorities. It will contribute to the cost of procuring technical reports and advice on the phases of a heat network’s development.” [p57] The HNDU team held a workshop in London last week where they set out their likely criteria for how they will judge applications to the fund – see the final slide (slide 12) of the following DECC presentation for full details on this. Attendees to the workshop were also informed that the HNDU team is being finalised at the moment, with an announcement expected shortly on the appointment of a lead Investment Director who will head the unit. Finance is anticipated to become available to local authorities for qualifying projects from this Autumn. Though the HNDU team has set itself a 7-year business plan – funding secured from DECC only lasts until 2015 at the moment.
July 2013: DECC issued the first set of detailed quarterly Green Deal Statistics last week which provide include some limited regional results on the roll-out of the Government’s flagship energy efficiency programme. Hence, a picture of the activity in London to date is beginning to emerge. A number of information releases were published simultaneously on June 27 and are set out below, along with points to note for the capital:
- The data provided is for the Q1 2013 and hence only covers activity up to 31 March 2013. By that time, 9,294 Green Deal assessments had been undertaken in England. The press release issued on June 27 advises that the latest number of assessments carried out is 38,259.
- 10% of these 9,294 assessments were undertaken in London (set out in Table 1 on p12 of the statistical news release)
- An accompanying data spreadsheet provides a local authority breakdown of assessments undertaken. Southwark and Haringey observed the highest level of assessments in London over the first quarter, with 105 and 100 assessments respectively. Kensington & Chelsea, and the City of London the lowest with 1 and zero respectively. A ‘league table’ of London boroughs is provided below
- London boroughs (including the GLA) was awarded a total of £925,000 under DECC’s Green Deal Pioneer Places programme earlier this year. See earlier post for details. Consequently, a number of local authorities were providing Green Deal assessments to their residents free of charge. These offers ran up to May for some local authorities, hence assessment numbers for Q1 and Q2 will be boosted by the fact that homeowners are broadly having these services provided free over this period.
- The DECC data spreadsheet also provides detail on houses assessed (type of home, energy efficiency rating of home) and the measures recommended in the assessment. Though useful, this data does not provide any real indication of how many homes will be eventually install energy efficiency measures. DECC’s press release has Minister Greg Barker stating that “78 per cent of people who have received a Green Deal Advice Report, following a Green Deal assessment, said they had, were getting or would get energy saving measures installed.”
- In the run-up to the launch of the Green Deal and Energy Company Obligation (ECO), Government recognised that London had not received its fair share of funding from the energy supplier obligations in the past, however, they decided not to establish a London-specific ECO target as they were of the view that London should benefit under ECO as the programme is strongly focussed on the installation of solid wall insulation (SWI) and London has a large percentage of such homes. A real measure of success in the future will hence be the number of SWI installs in the capital. The latest Green Deal & ECO monthly statistics – issued alongside the quarterly statistics – highlight that 1,565 SWI installs were completed over the first quarter of 2013 across the UK. This is at a far lower rate than previous quarters in previous years (see quarterly progress of SWI in Table 1 of DECC Estimates of Home Insulation Levels in Great Britain – released alongside the GD/ECO statistics). Unfortunately, neither the monthly or quarterly statistics provide a regional breakdown of where these installations took place. This is something DECC will need to provide to help better understand if the ECO is being delivered in London.
- The Green Deal Cash Back offer, an initial ‘sweetener’ offered by Government on a first come – first served basis, has a pot of £125m. The quarterly statistics for vouchers issued by Government actually go beyond the first quarter – to 16 June 2013 – and show that £263k has so far been awarded. Unfortunately, no regional breakdown has been provided of where these vouchers have been awarded.
So, early days as yet for both the Green Deal and the ECO. More detailed data would be helpful to determine the progress of the programmes in London and elsewhere. It will be interesting to see the Mayor’s response to the Green Deal after an assessment is completed for his own home.
Green Deal assessments by borough are provided below and have been re-ordered from that provided in the quarterly spreadsheet into a ‘league table’ order.