Select Committee on Environmental Audit Written Evidence


APPENDIX 14

Letter and memorandum to the Clerk of the Committee from the Environmental Services Association

  The Environmental Services Association (ESA) is the sectoral trade association representing the UK's waste and secondary resource management industry, a sector contributing more than £5.0 billion to the UK economy (about 0.5% GDP). Our Members want to build our industry's future on managing more waste as a resource by returning more of the materials and energy contained in waste back into the productive economy.

  ESA welcomes this opportunity to offer evidence. We are primarily concerned with Chapter 4 of the White Paper covering low carbon generation and our comments are focussed on how best to accelerate the UK's rate of renewable energy generation capacity.

Memorandum from the Environmental Services Association

EXECUTIVE SUMMARY

    —  The UK faces major environmental challenges: it is obliged by national and international agreements to change the way it generates energy and manages waste.

    —  The UK already lags behind other EU countries in the generation of renewable energy: if the Government is not to fall behind even further, action is needed now.

    —  The Energy White Paper does not grasp the opportunity to secure a more sustainable long-term supply of energy for the UK by providing the necessary impetus to encourage higher levels of renewable energy generation from all available sources.

    —  The UK does not appear to be putting policies in place to deliver the potential contribution of renewable energy from municipal solid waste. The Government has missed a significant opportunity to link energy policy and waste management policy to secure greater extraction of the energy contained within waste.

INTRODUCTION

  1.  The Royal Commission on Environmental Pollution concluded that the UK needed to reduce its carbon dioxide emissions by 60% by 2050 to avoid environmental catastrophe. In this context it would be reasonable to expect the Energy White Paper to put in place a framework to maximise the use of all possible low carbon energy sources.

  2.  However, the Government has continued to ignore the framework provided by the European Directive 2001/77/EC on promoting electricity from renewable sources and has opted for a selective approach without any apparent consideration of tools such as life cycle analysis or Best Practicable Environmental Option.

  3.  Article 2 of this Directive provides:

  "For the purposes of this Directive, the following definitions shall apply:

    a.  `renewable energy sources' shall mean renewable non-fossil energy sources (wind, solar, geothermal, wave, tidal, hydropower, biomass, landfill gas, sewage treatment plant gas and biogases); and

    b.  `biomass' shall mean the biodegradable fraction of products, waste and residues from agriculture (including vegetal and animal substances), forestry and related industries, as well as the biodegradable fraction of industrial and municipal waste."

  4.  Nonetheless, Government has decided generation of renewable energy from the incineration of mixed waste does not count towards the UK's 10% renewable energy target by 2010 and is ineligible for support under the Renewables Obligation. We believe the Government should include this source of energy for the purposes of meeting official renewable energy targets, in line with Directive 2001/77/EC.

A GREENER WHITE PAPER

(a)   Connecting Waste and Energy Policy

  5.  Currently, 48% of the UK's renewable energy is derived from municipal solid waste. 27% is generated from landfill gas (installed capacity is projected to increase by 65% by 2010), and 21% is generated by combusting waste.

  6.  Implementation of the Landfill Directive-requiring the diversion of large amounts of waste from landfill to other treatment options-provides significant potential to increase renewable energy capacity by thermal treatment of waste using both conventional technologies and emerging technologies such as gasification and pyrolysis.

  7.  ESA is disappointed that even though the PIU report "Making more with less"[34] identified climate change and waste generation as the first and second environmental priorities for Government; the Energy White Paper fails to connect these two vitally important issues.

  8.  The UK lags far behind other EU Member States in its installed renewables capacity. The UK's share of renewables, based on gross inland consumption, was only 1.1% for 2000, compared to 30.7% for Sweden, 23.9% for Finland and 23.2% for Austria[35]

  9.  Likewise, progress in deploying energy from waste capacity in the UK has also been noticeably slower than in other Member States: whilst the UK extracts energy from 8% of its municipal waste, Denmark derives energy from 59% of its waste and the Netherlands 42%.

  10.  Furthermore, other Member States make more provision for district heating infrastructure than the UK. Denmark provides the economic and regulatory framework to make it viable for energy from waste facilities to supply heat and electricity to local communities: 57% of municipal waste incinerated is treated in CHP plants compared to 17% in the United Kingdom.

  11.  Energy from waste facilities provide an important opportunity for the generation of good quality CHP. Whilst the recent announcement of Climate Change Levy exemptions for energy generated by CHP facilities is welcome, further incentives for the development of CHP are urgently required.

  12.  The Government must overcome a number of obstacles in order to increase CHP in the UK:

    —  there is limited installed district heating infrastructure in the UK;

    —  obtaining the necessary planning permission and laying the infrastructure can be difficult and costly; and

    —  plant needs to be situated close to new high-density housing developments or industrial parks where the necessary infrastructure can be installed in the construction phase to accommodate heating schemes.

  13.  For CHP to work, end users need to be connected. Building regulations and planning guidance should reflect the need to accommodate CHP schemes where they are technically feasible and economically viable.

(b)   Financing Green Energy

  14.  New infrastructure can only be delivered and operated if it is economically viable. The UK renewable energy market is characterised by low certainty and high risk. Financial institutions can only release capital if they are confident that the investment is sufficiently likely to generate a reasonable return.

  15.  The Energy White Paper does not provide an adequate financial framework for accelerating the deployment of new renewable capacity. The Government must:

    —  bring forward the review of the Renewables Obligation to no later than 2004-05 so that long term investment decisions can be based on the certainty provided by long-term Government commitment; and

    —  set the percentages for the Renewables Obligation on a 10-year rolling basis to provide certainty each year on the proportion of renewable capacity that will be obligated in 10 years time.

(c)   Can the Planning System Cope?

  16.  The White Paper recognises that in order for the UK to meet the Government's 10% renewable energy target, an additional 1,250 MW of renewable energy capacity will need to be installed every year until 2010, against a current total installed capacity of only 1,200 MW. The challenge in achieving this is obvious, and even greater if the Government intends to achieve a 20% target by 2020.

  17.  Government targets must be supported by appropriate policies to enable their delivery. If the Government is to set itself a target on the generation of renewable energy then it is incumbent on the Government as a whole to deliver on the target. Renewable energy targets must be supported by appropriate policy across the Government.

  18.  The review of national planning policy guidance note PPG22 must strengthen existing planning guidance for renewable energy projects. Further reform of the system is required to speed up the assessment of planning applications and to achieve greater certainty in the delivery of decisions.

  19.  Review of PPG22 on renewable energy should be coordinated with review of PPG10 on waste management in order to coordinate energy and waste planning policies.

(d)   Connecting End Users

  20.  If the UK's energy policy is to move forward, the Government must ensure the availability of appropriate and cost-effective grid connections. It is well known that a more decentralised energy supply system will require modifications to the design and operation of the grid.

  21.  The availability of suitable and affordable grid connections is of particular importance with regard to the planned introduction of BETTA by April 2005, whereby a single set of electricity trading rules, connection policies and transmission trading costs will apply throughout the UK.

April 2003


34   Resource Productivity Making more with less' Performance and Innovation Unit, 2001. Back

35   Statistical Office of the European Union. Back


 
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