Non-fossil Fuel Obligation (Hansard, 3 November 1998)

§ Mr. Öpik
To ask the Secretary of State for Trade and Industry (1) what plans his Department has to change the current bidding system for gaining a non fossil fuel obligation contract; and if he will make a statement; [57977]
(2) if his Department will introduce measures to allow the payment of green electricity subsidy payments to small wind power producers outside the non fossil fuel obligation scheme; and if he will make a statement; [57978]

§ Mr. Battle
This Government propose to undertake a new and strong drive to develop renewable energy sources in line with their manifesto commitment. To this end, I have commissioned a review of policy including considerations of what would be necessary and practicable to achieve 10 per cent. of UK electricity needs from renewables by the year 2010 and how renewables can make an effective contribution to meeting requirements for future greenhouse gas reduction commitments.
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That review is considering both support mechanisms for renewable energy, such as NFFO—and including the current bidding system—and the development of the green electricity market in the UK as well as the links between Government support and market development.
My Department has also recently issued a public consultation paper on the future of gas and electricity regulation, entitled "A Fair Deal for Consumers— Modernising the Framework for Utility Regulation", which is considering a number of wider issues affecting the electricity industry, including proposals on the separate licensing of supply and distribution. My Department will be consulting on how the NFFO might be adapted to such new circumstances.
A number of companies operating in the green electricity market now developing outside the NFFO arrangements already offer a green premium to small renewable power producers generating from a number of renewable energy sources.

§ Mr. Öpik
To ask the Secretary of State for Trade and Industry (1) what measures his Department has taken since 1 May 1997 to encourage the generation of power using(a) onshore and (b) offshore wind turbines; and if he will make a statement; [57975]
(2) what plans his Department has to provide financial assistance to individuals and communities for the erecting and running of wind turbines; and if he will make a statement. [57976]

§ Mr. Battle
As a first step in the Government's new and strong drive for renewables, I announced the fifth and largest Non-Fossil Fuel Obligation (NFFO-5) Order on 24 September 1998 of 1177 MW. This includes 36 projects, comprising 28 MW of contracted capacity from the special band for small wind turbines which is of particular interest to individuals or communities.
My current review of renewable energy is considering the contribution each renewable energy source could make, including onshore and offshore wind energy, the barriers to deployment and the measures which may be necessary to overcome them, and the need for research, development, demonstration and dissemination. I expect to make an announcement about the Review later this year.
In the meantime, my Department's New and Renewable Energy Programme continues to support a wide range of research projects related to wind energy and geared mainly towards onshore deployment, stimulated by successive Orders under the Non-Fossil Fuel Obligation. The Programme has also funded a series of studies related to community involvement in and development of renewable energy schemes and has produced a useful guide entitled "Community involvement in renewable energy projects—A guide for community groups". My Department has also worked with Triodos Bank towards the successful launch of the Wind Fund.
Also in September this year, I took a major step towards generating electricity from offshore wind by launching a consultation document on arrangements for incorporating the development of offshore wind energy into the Non-Fossil Fuel Obligation Order (NFFO) process. Current work on offshore wind, includes monitoring the development of the first offshore wind 513W NFFO project, at Blythe, and assessing the commercial opportunities for UK manufacturing industry within the offshore wind arena.