Select Committee on Innovation, Universities, Science and Skills Written Evidence

Memorandum 49

Updated submission from the British Wind Energy Association


  While progress is being made in the deployment of wind power in the UK, key barriers to progress in the planning system and access to the grid remain. Solutions to these issues are available, but they are not being implemented swiftly. The recent reform proposals for the Renewables Obligation should ensure stability in the market, but further reform will be necessary if 2020 targets are to be met. Wave and tidal stream technologies require concerted and coherent support if the industrial potential they represent is to be secured for UK business: at present, the path beyond the Marine Renewables Deployment Fund is not clear. Further action is required on the research and skills agendas, with clarity in the funding of the former needed. A strategy for developing industrial infrastructure, particularly for offshore wind, is also vital.

  1.  The British Wind Energy Association (BWEA) is the leading UK trade association in the field of renewable energy, with over 350 corporate members representing the large majority of the wind energy business in this country. Wind energy is the fastest-growing renewable technology in the UK, and will make an increasingly significant contribution to our electricity supplies over the next decade and beyond. BWEA also represents the interests of the emerging wave and tidal stream energy sector, building on its experience in the development of offshore wind.

  2.  Currently there are 160 wind farms operating in the UK, seven of which are offshore. These have a total capacity of 2,320MW, made up of 1,916MW of onshore and 404MW of offshore wind. In addition, 909MW of onshore wind capacity and 457MW of offshore capacity are currently under construction, while a further 1,992MW of onshore and 2,664MW of offshore projects have consent and await construction.[195]

  3.  Despite the good progress in building wind generation capacity—in February 2007 the UK became only the eighth country in the world to break the 2,000MW barrier—there is considerably more potential in the UK, and BWEA members are keen to exploit this. Onshore, there are currently 7,555MW of projects being considered by planning authorities at all levels, which if all built would generate approximately 6% of UK power demand. If only one sixth of this capacity was consented by the second quarter of 2008, then it is still just possible for the current target of 10% of the UK's power to be gained from renewable sources by 2010 to be achieved.

  4.  However, the planning system is a major barrier to achieving build-out of onshore wind in the UK. There are projects that have been held up in the system for up to four to five years, and in general the planning arrangements in the UK do not deliver timely decisions for wind projects: only 5% of all onshore wind applications are decided within the supposed statutory limit of 16 weeks, while for other large projects of all kinds (those requiring Environmental Impact Assessments), verdicts are reached on 70% within their limit of 13 weeks, according to an analysis of all such decisions in 2006.[196]

  5.  While BWEA welcomes the attempt by Government to improve this situation through its proposals in the Planning White Paper and consequent Bill, these will have only a limited impact on the consenting of onshore wind. The new Infrastructure Planning Commission (IPC) will only decide on projects of greater than 50MW (the current Section 36 limit) in England and Wales. The number of such projects that will be coming through the system after the IPC comes into existence will be very limited, since such sites are rare in England and Wales, and most of these will have been developed before the IPC comes into operation.

  6.  For projects under 50MW that are currently within the system in England, Planning Policy Statement 22 (PPS22) is supposed to guide local authorities in making their decisions. However, BWEA members are finding that their projects are rejected for reasons which are in contravention of this guidance. Central Government, while it should be lauded for putting in place strong policy, has failed to ensure that it is followed on the ground.

  7.  As outlined in paragraph 3 above, the 2010 target is still achievable. However, because of the time taken from consent to operation, the horizon for consenting wind farms which can contribute to the target is fast approaching. Given current trends in procuring wind turbines, gaining a grid connection and discharging planning conditions, BWEA considers that only projects consented before mid-2008 can contribute to the 2010 target. This places a significant emphasis on timely delivery of positive decisions in the intervening months. BWEA therefore welcomes BERR's action to send the "Renewables Statement of Need",[197] contained in the 2006 Energy Report "The Energy Challenge" and reiterated in the Energy White Paper, to all planning authorities in the UK. A similar intervention occurred in April 2007 when the Head of the Planning Division of the Welsh Assembly Government wrote to Welsh planning authorities explaining what is expected of those bodies in delivering Welsh renewable energy targets.

  8.  It is highly important that central Government acts to enforce current policy guidance, otherwise in the new situation envisaged under the proposed planning reforms, where local authorities are supposed to be guided by new National Planning Statements, onshore wind projects will still be rejected by local authorities. This will only add to the expense and time needed to determine an application, not only for the developer but also for the local authority, particularly if the former is awarded costs from any appeal procedure.

  9.  In the offshore sector, consents have been awarded for the first Round Two projects, and in general the system is comprehensible and working reasonably well. We have some concerns, however, regarding the interaction between the licensing proposals in the Marine Bill White Paper and those in the Planning Bill currently before Parliament. The latter proposes that the IPC has the final say for offshore generating projects of 100MW or more, while smaller projects are decided by the proposed Marine Management Organisation. While BWEA understands that Government appears determined on this split responsibility, there is the distinct possibility of confusion, inefficiency and inconsistent decision-making under this new structure.

  10.  The other key non-economic constraint to the deployment of wind power is access to electrical networks, both transmission and distribution. The main issue for our industry is that access to and management of the transmission network is still approached on the basis that large, dispatchable central generators are assumed to be the norm. Smaller, dispersed generators which generate when their resource is available are difficult to accommodate within this model. Changing the ground rules to expedite connection and allow more variable generation onto systems is taking a long time: BWEA's perception is that this process can be accelerated. A key actor in this process is Ofgem. Some argue that in order to deliver on the sustainability agenda, the regulator's statutory remit should be changed, a case most cogently put by the Sustainable Development Commission.[198] Others argue that Ofgem can take the necessary action within its current remit and thus legislating for change will divert time and energy from the urgent work required. Whether the remit needs to change or not, it is clear that action is necessary to speed the connection of renewable generators, reform system operation to better accommodate variable sources, and develop the infrastructure in a strategic manner. Ofgem has been more proactive recently in promoting the sustainable development agenda, but the rate of change is still painfully slow.

  11.  In addition, planning and delivering the enhanced grid infrastructure required to transmit power from where the wind blows strongest (and waves and tides are best exploited) will be challenging. This is where the planning reforms that Government is proposing are likely to have the most beneficial effect in ensuring the growth of renewable generation. We do not believe that the variability of wind generation should have a significant impact on the contribution that it can make to the electricity mix in the foreseeable future. The UK Energy Research Centre's comprehensive report on the subject[199] makes clear that certainly 20% of our power supply can be accommodated with some additional investment in balancing plant, and much of the large expansion of offshore wind that will be required to achieve our commitments under the EU 20% target will undoubtedly be sited along high-capacity interconnectors with mainland Europe, which will increase our capacity to absorb the output. Continually improving predictions of wind output 24 hours and more ahead of time will also make the task of managing this output easier.

  12.  The third key issue affecting deployment of wind power is the economics, and here there has been welcome progress in bringing stability to the market. The detailed proposals regarding the reform of the Renewables Obligation (RO) contained in the Energy White Paper showed clear evidence of Government taking on board the response of the renewables industry to the preliminary consultation of late 2006. BWEA believes that the current reform package is a suitable platform for growth in the short to medium term, so long as the planning and grid issues are resolved.

  13.  Welcome as this outcome is, it is becoming very clear that there will need to be further change if growth is to be sustained into the long term, and growth is required to meet new commitments. The sudden end of the RO in 2027-28 will begin to deter investment in new renewable generating capacity from about 2012 onwards, starting with the more expensive technologies, particularly offshore wind. This is because the period under the RO that investors will be able to recoup their outlay will get progressively shorter: there will come a point where the income available under the RO will not sustain the investment, and new build will stop. Government's own analysis[200] clearly shows this effect, with new capacity build peaking in about 2012-13 and dropping away to nothing in about 2020. Even with a strong carbon price signal, the abrupt end of the RO will inevitably disrupt investment.

  14.  While a solution to the 2027 issue is required to meet the current "aspiration" to have 20% of UK power from renewables in 2020, further change will be needed if the UK is to meet the likely commitments required under the EU 20% by 2020 renewable target. This target is for all energy use, and given the resources and relative development of technologies in the power, transport and heating/cooling sectors, the renewable electricity contribution to this figure will have to be much more than 20%—perhaps in the range 30-40%. European Commission analysis indicates this contribution would have to be 34% for the EU as a whole, compared to the 19% likely to be delivered by 2010. While the UK is far behind in terms of renewables' contribution to current energy supply (now about 2%), this country has considerable renewable resources, and thus might be expected to deliver an increase of around the EU average. The Government's current "aspiration" will thus be inadequate. The RO, even when reformed in line with the current proposals as set out in the Energy Bill, will not deliver this. Either it will have to be extended further, or an additional system put in place to deliver the extra power. What such a system might look like would be dictated by the resources favoured to provide that power. BWEA believes that offshore wind has a significant role to play here.

  15.  While the exact target that the UK will have to aim for under the EU 20% objective is not yet clear, BWEA believes that at least 20,000MW of offshore wind is both necessary for the prospective share, and possible by 2020.[201] In order to get there, however, some key actions must be taken soon. First and foremost is that urgent steps must be taken to roll out a site award process. BWEA is thus encouraged that Government has now published its scoping document for the necessary Strategic Environmental Assessment, and that it projects first site awards from this process in 2009, a year ahead of the date set out in the Energy White Paper. The amount of capacity that will result from this process—the scoping document posits a maximum of 25GW—and exactly when it is awarded are key variables yet to be determined. Given the lead time between site award and project commissioning, all the sites that could possibly contribute in 2020 will have to have signed agreements to lease by about 2013. We look forward to working with Government and Crown Estate to expedite these awards, and to streamline and speed up the consenting process so that delivery can be brought forward. The latter is already being worked on ahead of the advent of the IPC. Together, these activities should ensure a smooth and growing flow of projects coming to market, thus encouraging supply chain investment.

  16.  The prospects for the other technologies that BWEA champions, wave and tidal stream, are less clear. However, the magnitude of the available resource means that the UK could potentially supply 15-20% of its generation needs from this sector alone.[202] Currently only a handful of devices are approaching first commercial deployment, and these have been slower to come through than had been hoped. This has meant that the project support available under the Marine Renewables Deployment Fund has not yet been called upon. Further, the Emerging Technologies band under the reformed RO gives 2ROC/MWh, which will not provide enough revenue for post-MRDF projects to achieve commercial viability—which Government itself acknowledges. The wave and tidal sectors are consequently in a very uncertain position: it is clear that funding beyond the MRDF will be required within the period covered by the current Comprehensive Spending Review, yet Government will not commit more money while the MRDF remains unspent. This unfortunate position is further complicated by the very confusing proliferation of funding streams for new energy technologies, as discussed below. However, the Government has invested relatively heavily in wave and tidal already, creating an unrivalled infrastructure, both physical and intellectual. Were it to waver now, failing to put in place a clear path from the MRDF to the RO at 2ROC/MWh, that investment would be wasted as other countries overtake us. That is a real possibility.

  17.  Considering the wider landscape for renewable technology research, development and demonstration, Government will have to act quickly to resolve the current confusion and ensure that the maximum benefit to the UK economy is delivered. What is appropriate varies by technology: onshore wind is a mature technology, and future R&D will be primarily driven by manufacturers, from their own budgets, though some complementary innovation may result from European and national co-funding; for offshore wind there is more scope for Government to support UK companies in developing key technologies and techniques; in the wave and tidal sector, a sustained commitment to pull these emerging technologies into the market will bring significant industrial rewards, with UK firms becoming world leaders. Consequently, Government should be providing a coherent set of funding streams, each tailored to the needs of technologies at different stages of development.

  18.  The funding landscape in the UK for research, development, demonstration and deployment is complex and confusing (see Figure 1). In an ideal world this would be rationalised, with fewer bodies and clearer boundaries. We are also anxiously awaiting the final decisions on the priorities and funding allocations for the Environmental Transformation Fund, as this will be the prime funding route for the funds for demonstrating wave and tidal stream technologies beyond the MRDF. We are, however, encouraged now that the Energy Technologies Institute (ETI) has completed its long gestation and is now soliciting expressions of interest, with an early focus on offshore renewables. We are also pleased that it is cooperating with the Carbon Trust to maximise the value of their combined funds being devoted to offshore wind. Whether the ETI has a role in bringing more coherence to the overall scene is yet to be seen, but this is a vital function that must be taken on by someone. This was a key recommendation of the Commission on Environmental Markets and Economic Performance (CEMEP),[203] and BWEA fully supports this conclusion.

Figure 1


Source: BERR

  19.  In a world where the imperatives of tackling climate change and promoting security of supply are driving rapid expansion of the renewable energy sector, it is becoming increasingly apparent that establishing a manufacturing base in the UK will be essential if our ambitious objectives under the EU's 20% by 2020 target are to be met. Government will need to work closely with wind industry players and the wider manufacturing community to publicise the opportunities that the UK offers, above all in offshore wind power, and to encourage investment. This is particularly necessary in the area of component supply—gearboxes, bearings, transformers, etc. If UK companies enter this sector, then the prospects for turbine manufacture in this country will be much improved.

  20.  Development of an active manufacturing supply chain will be encouraged by the establishment of a coherent "intellectual infrastructure", made up of centres of excellence in a number of key technology areas. The wave and tidal sectors have shown the way here, with a solid research base in the universities built upon by the creation of the New and Renewable Energy Centre in Blyth and the European Marine Energy Centre in Orkney. With the forthcoming Wave Hub off the coast of Cornwall promising a multi-device array test bed, a coherent and complete development process is being supported. If an industry is to be encouraged around offshore wind, then similar structures are needed for this technology. Some initiatives are in hand, such as the Orbis Centre in Lowestoft, but there needs to be a clear strategy to guide activity so that resources are used effectively. Government must urgently partner with the research community and the wind industry to establish such a strategy and deliver on it. If done well, clustering will encourage an `ecology' of entrepreneurial companies developing new technologies and building prosperity.

  21.  Centres of excellence in technology can also help in building up the skills base that is vital for delivery. Focused training with experts and opportunities in the wider ecology around such centres will bring in the talented young people that this sector needs. However, wind, wave and tidal stream will need people with a wide range of skills, from development and design, through construction and into operations. The industry recognises that action is necessary, but we need to forge links with bodies such as the Energy and Utility Skills Council and the National Skills Academy in order to develop programmes that deliver the people that are required. DIUS is well placed to coordinate and drive such activities, and with Government now pushing a much more dynamic agenda on renewable energy, the department should take a proactive role.

  22.  Alongside the intellectual infrastructure for delivery, physical infrastructure is essential. A good example of this is port capacity for both construction and service of offshore wind farms. Unless a strategy for focused development of a few specialised ports is pursued, there is a danger that activity will be too dispersed and larger, better-resourced ports on mainland Europe become construction hubs for UK projects. A strategy must be formulated to avoid this, in the first instance by bringing together the Regional Development Agencies to agree a way forward and focus efforts. Such activities around ports and other key infrastructure could be a key element of the work of BERR's Renewables Advisory Board, now that it is being chaired by the Secretary of State with a remit to deliver on our 2020 EU commitments.

January 2008

195   Up to date statistics on the progress of wind power in the UK can be found on the BWEA website, at Back

196   DCLG statistics:

197 Back

198   Lost in Transmission: The role of Ofgem in a changing climate, Sustainable Development Commission, September 2007. ( Back

199   The Costs and Impacts of Intermittency: An assessment of the evidence on the costs and impacts of intermittent generation on the British electricity network, UK Energy Research Centre, March 2006 ( Back

200   Reform of the Renewables Obligation: What is the likely impact of changes? Report by Oxera for DTI, May 2007. URN 07/949. ( Back

201   Further analysis of the offshore wind sector's ability to deliver up to 2020 can be found in BWEA's report UK Offshore Wind: Moving up a gear ( Back

202   Future Marine Energy. Results of the Marine Energy Challenge: Cost competitiveness and growth of wave and tidal stream energy, Carbon Trust, January 2006. CTC601. (Available here: 

203   See Recommendation 12 of Commission on Environmental Markets and Economic Performance-Report, DEFRA, November 2007. PB12671. ( Back

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