HC Deb 10 April 2000 vol 348 c35W
Ms Walley

To ask the Secretary of State for Trade and Industry how much of the non-fossil fuel obligation income for renewable energy support remains unspent in terms of(a) income not yet spent or allocated to a non-fossil fuel obligation project and (b) income allocated to a non-fossil fuel obligation project but not yet taken up by the project sponsors; and if he will make a statement in respect of unspent and unallocated non-fossil fuel obligation income to support the development of renewable energy. [117706]

Mrs. Liddell

Receipts from the Fossil Fuel Levy can be used only for expenditure on the above market cost of electricity generated under contracts entered into as a consequence of non-fossil fuel obligations (NFFO) and the related administrative costs of the Office of Gas and Electricity Markets (Ofgem) and their agents. The surplus of receipts over expenditure is currently about £70 million. Expenditure on electricity contracted under the third, fourth and fifth non-fossil fuel obligations (NFFO-3, 4 & 5) for renewables is estimated to be £42 million in financial year 1999–2000. This figure is expected to rise to £60-£80 million next year and peak in 2003–04 as more projects commission and generate. Expenditure is likely to continue until November 2018 when the last contract ends. In the event that Fossil Fuel Levy receipts fail to cover NFFO expenditure generators might not be paid. The surplus is maintained at a level intended to guard against rapid and unexpected falls in electricity prices that would reduce levy receipts and increase NFFO expenditure.

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