HC Deb 29 April 2002 vol 384 cc585-6W
Mr. Carmichael

To ask the Secretary of State for Trade and Industry to what degree energy production from(a) renewable sources, (b) wind and (c) CHP have changed since the introduction of NETA. [51961]

Mr. Wilson

The most recent data on the electricity output from renewable, wind and CHP sources were published on 31 August 2001 by Ofgem in its "Report to the DTI on the Review of the Initial Impact of NETA on Smaller Generators", covering the first two months of NETA operation. It found that, for those two months, compared with the corresponding two-month period a year earlier, output had decreased as follows:

  1. (a) for renewables (excluding hydro and wind), by 7 per cent;
  2. (b) for hydro, by 14 per cent:
  3. (c) for wind, by 13 per cent; and
  4. (d) for CHP, by 61 per cent.

A significant rise in gas prices that occurred in the same months may have contributed to the very large fall in CHP output recorded in the survey period.

Ofgem has committed in its corporate plan to carry out a review of NETA covering the first year of operation, to be published in the second quarter of 2002. Ofgem has indicated it intends to include as part of its one year review a chapter on the impact of NETA on smaller generators during the first year of NETA operation. In addition, further data on the output of electricity from renewables (including wind) and CHP sources are expected to be published in July 2002 in the DTI's annual "Digest of UK Energy Statistics".

Following the Ofgem report of 31 August 2001, the Government set up a consultation on NETA and smaller generators, and on 4 April 2002 published their response. This identifies action to help smaller generators orerate more effectively within NETA. It is available on the DTI website at www.dti.gov.uk/industries_energy.html#markets.

The introduction of the Renewables Obligation on 1 April this year provides a substantial impetus to the use of renewable electricity. On CHP, DEFRA are working to produce a draft strategy that will be out to consultation shortly. In the recent Budget, several measures were announced that would benefit CHP, including extending the exemption of CHP from the climate change levy.