95% Cut in Payments for Small-Scale Renewables to Hit Energy from Waste

ESA: Ofgem Waste to Energy Cuts Make Mockery of Circular Economy

The decision by the UK’s energy regulator Ofgem to reduce payments to small decentralised generators by almost 95% has been criticised by the Environmental Services Association.

The decision by the UK’s energy regulator, the Office of Gas and Electricity Markets (Ofgem) to reduce payments to small decentralised generators by almost 95% has been criticised by UK trade association, the Environmental Services Association (ESA).

The organisation explained that Ofgem’s decision to cut the payments from £45/kW to between £3/kW and £7/kW over three years will hit small-scale renewables, including waste-fuelled electricity generated at waste to energy, Anaerobic Digestion and landfill gas facilities.

"Ofgem has ignored our concerns about the scale of the proposed cuts to small, decentralised, low-carbon generators,” said ESA's executive director, Jacob Hayler.

“Not only does this decision endanger the UK's renewable energy commitments, it also makes a mockery of our Circular Economy ambitions by disincentivising resource efficient use of waste as a fuel,” he continued.

According to Hayler the removal of these payments will raise costs of waste management for local authorities at a time when services are already under threat.

"Energy generated from waste is a reliable source of low-carbon baseload electricity which contributes to the UK's security of supply whilst keeping costs down for consumers,” he noted.

ESA has previously scriticised highly complex network charging and called for them not to be made in isolation due to the risk of unintended consequences.

“Despite the Government's pronouncements on the importance of diversifying the energy mix, Ofgem has favoured big fossil fuel power stations over smaller more sustainable generators which could now be forced out of the market,” concluded Hayler.

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