HC Deb 18 December 2001 vol 377 cc267-8W
Mr. Key

To ask the Secretary of State for Trade and Industry under what circumstances operators are permitted under the NFFO transfer provisions to aggregate two or more existing NFFO contracts from different sites into one project. [23039]

Mr. Wilson

Decisions on whether modified NFFO contracts remain qualifying arrangements for Fossil Fuel Levy purposes are for Ofgem. My understanding is that aggregation of contracts is not permitted under current arrangements, and that the Locational Flexibility Order will not change this position.

The possibility of allowing aggregation was raised in the consultation on locational flexibility.

We will consider the complex legal and policy implications of aggregation with a view to bringing forward possible further legislation in the new year to allow some aggregation.

Mr. Key

To ask the Secretary of State for Trade and Industry how many requests to amend NFFO contracts to enable implementation Ofgem has(a) received, (b) granted and (c) refused; and in cases where they have been refused, for what reason. [23041]

Mr. Wilson

This is a matter for Ofgem.

I have asked Mr. Callum McCarthy, the chief executive of Ofgem, to write to the hon. Member and to copy his reply to me, so that it may be placed in the Libraries of the House.

Ofgem, however, does not grant or refuse contract amendments as such amendments are a matter for the contracting parties. Ofgem has to assess whether any contract amendment would cause the project to cease to be a qualifying arrangement for receiving support from the fossil fuel levy. Each case is considered on its facts. If Ofgem decides that a project for which a contract amendment has been agreed has ceased to be a qualifying arrangement, that project will cease to receive support from the fossil fuel levy.

Mr. Key

To ask the Secretary of State for Trade and Industry what guidance she has provided to(a) the Non-Fossil Purchasing Agency and (b) to Ofgem defining the criteria for the transfer of NFFO contracts. [23037]

Mr. Wilson

The criteria for the transfer of NFFO contracts are set out in the Electricity from Non-Fossil Fuel Sources (Locational Flexibility) Order 2001.

Mr. Key

To ask the Secretary of State for Trade and Industry what the roles are of(a) her Department, (b) the Non Fossil Purchasing Agency and (c) Ofgem in approving requests for NFFO contract amendments. [23038]

Mr. Wilson

The DTI has no role in approving requests for NFFO contract amendments.

The Non Fossil Purchasing Authority (NFPA) is counter-party to contracts and must agree any amendment. If the NFPA has any doubts as to whether the amended contract would remain a qualifying arrangement for support from the fossil fuel levy, it consults Ofgem.

Ofgem's role is to make payments from the fossil fuel levy in respect of qualifying arrangements and to set and collect the levy. Ofgem cannot make payment in respect of contracts which are no longer qualifying arrangements.

Ofgem is also required under NFFO contracts to approve terminations of contracts for economic reasons. Other terminations are matter for the NFPA and the contract-holder.

Separate but similar arrangements apply in Scotland where the SRO contracts are held by the supply successor companies and not by the NFPA.

Mr. Key

To ask the Secretary of State for Trade and Industry how many NFFO contracts which would otherwise have failed she expects to be brought to fruition through the new arrangements for site transfer; and what steps she is taking to maximise take-up. [23040]

Mr. Wilson

The industry estimates that over a 100 projects across a wide range of technologies want to move.

The Government have played their part by making the NFFO Locational Flexibility Order, and it is now up to developers to take advantage of the new opportunities provided by that Order.

Mr. Key

To ask the Secretary of State for Trade and Industry if she will list the contracts under the Non Fossil Fuel Obligation which have been transferred from one site to another since March. [23036]

Mr. Wilson

There have been none. The Government are introducing an Order to facilitate such transfers.