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You are here: BAILII >> Databases >> United Kingdom Statutory Instruments >> The Renewables Obligation (Amendment) Order 2018 URL: http://www.bailii.org/uk/legis/num_reg/2018/uksi_2018896_en_1.html |
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This is the original version (as it was originally made). This item of legislation is currently only available in its original format.
Statutory Instruments
Electricity, England And Wales
Made
19th July 2018
Coming into force in accordance with article 1(1)
The Secretary of State, in exercise of the powers conferred by sections 32, 32A, 32B, 32C, 32D, 32J and 32K of the Electricity Act 1989(1), makes the following Order.
The Secretary of State has consulted the Gas and Electricity Markets Authority; (in relation to the amendments made by articles 4 and 5) the National Consumer Council(2); (in relation to all other amendments) the National Association of Citizens Advice Bureaux and the Scottish Association of Citizens Advice Bureaux; the electricity suppliers to whom this Order applies; and such generators of electricity from renewable sources and other persons as the Secretary of State considered appropriate in accordance with section 32L(1) of the Electricity Act 1989.
In exercising the power to make provision under section 32D(1) of the Electricity Act 1989, the Secretary of State has had regard to the matters specified in section 32D(4).
In accordance with section 32L(2) of the Electricity Act 1989, a draft of this instrument was laid before Parliament and approved by a resolution of each House of Parliament.
1.-(1) This Order may be cited as the Renewables Obligation (Amendment) Order 2018 and comes into force on the day after the day on which it is made.
(2) This Order extends to England and Wales only.
2. The Renewables Obligation Order 2015(3) is amended in accordance with articles 3 to 6.
3.-(1) Article 28 is amended as follows.
(2) In paragraph (1), for "paragraphs (3) and (5)" substitute "paragraphs (2) and (5)".
(3) In paragraph (3), for "paragraph (3)" substitute "paragraph (2)".
(4) After paragraph (6) insert-
"(7) This article is subject to Schedule 6.".
4.-(1) Article 35 is amended as follows.
(2) After paragraph (3) insert-
"(3A) But paragraph (3) does not apply in the case of relevant electricity generated using pre-2013 capacity by a relevant qualifying CHP station unless a declaration has been made in accordance with paragraph (7) in respect of the pre-2013 capacity of the station.
(3B) In paragraph (3A), "relevant qualifying CHP station" means a qualifying CHP station that-
(a)was accredited on or before 31st March 2013; and
(b)became a qualifying CHP station for the first time on or after the date on which the Renewables Obligation (Amendment) Order 2018 comes into force.".
(3) In paragraph (7)-
(a)in sub-paragraph (b) after "in respect of the" insert "pre-2013 capacity,";
(b)after sub-paragraph (b) insert-
"(ba)in the case of a declaration made in respect of the pre-2013 capacity of the station, it confirms that-
(i)pre-2013 capacity forms part of the total installed capacity of the station, and
(ii)support has not been given under any relevant scheme for heat produced by the use of that generating capacity;".
5.-(1) Schedule 2 is amended as follows.
(2) In paragraph 1 (interpretation), in paragraph (b) of the definition of "post-2013 dedicated biomass station" after ""dedicated biomass"" insert "(including "dedicated biomass with CHP")".
6. After Schedule 5 insert-
Article 28
1. In this Schedule (including the modifications to this Order set out in paragraphs 8 to 18)-
"2018/19 obligation period" means the obligation period starting on 1st April 2018;
"capped combustion unit" means a combustion unit of a relevant fossil fuel station other than any of the following-
an exempt combustion unit;
a combustion unit consisting entirely of generating capacity referred to in article 45(4)(a);
a combustion unit referred to in article 45(4)(d) or (e);
"capped generating station" means a relevant fossil fuel station that includes at least one capped combustion unit and no exempt combustion units;
"commencement day" means the day on which the Renewables Obligation (Amendment) Order 2018 comes into force;
"exempt combustion unit" is to be construed in accordance with paragraph 2;
"mixed generating station" means a relevant fossil fuel station that includes at least one capped combustion unit and at least one exempt combustion unit;
"qualification day" means-
in the 2018/19 obligation period, the later of 1st September 2018 and commencement day;
in any subsequent obligation period, 1st September;
"relevant day" means the first day of the second month after the month in which the Renewables Obligation (Amendment) Order 2018 comes into force;
"relevant electricity" means-
electricity to which article 36 applies;
electricity generated in any of the ways described in Schedule 5 as-
"co-firing of regular bioliquid" (including "co-firing of regular bioliquid with CHP");
"high-range co-firing" (including "high-range co-firing with CHP");
"low-range co-firing" (including "low-range co-firing with CHP");
"mid-range co-firing" (including "mid-range co-firing with CHP");
"station conversion" (including "station conversion with CHP"); or
"unit conversion" (including "unit conversion with CHP");
"relevant fossil fuel station" has the meaning given in Schedule 5, but does not include-
a generating station in relation to which ROCs have been issued in respect of electricity-
generated before the date on which the generating station became a "relevant fossil fuel station" (as defined in Schedule 5); and
described as "dedicated biomass" (including "dedicated biomass with CHP") in Schedule 2 to the Renewables Obligation Order 2009 or Schedule 5; or
a microgenerator.
2.-(1) Subject to sub-paragraphs (2) and (3), a combustion unit of a relevant fossil fuel station is an "exempt combustion unit" for the purposes of this Schedule if it is a combustion unit in relation to which ROCs were issued in respect of electricity-
(a)generated before 12th December 2014; and
(b)described in Schedule 2 to the Renewables Obligation Order 2009 as "unit conversion" (including "unit conversion with CHP") or "station conversion" (including "station conversion with CHP").
(2) The following are not "exempt combustion units"-
(a)a combustion unit consisting entirely of generating capacity referred to in article 45(4)(a);
(b)a combustion unit referred to in article 45(4)(d) or (e).
(3) A combustion unit referred to in sub-paragraph (1) ceases to be an "exempt combustion unit" if, during any 6 month period since commencement day, it generates electricity from fossil fuel, where the energy content of the fossil fuel is more than 15% of the energy content of all of the energy sources used by the unit to generate electricity during that 6 month period.
(4) In sub-paragraph (3), "fossil fuel" does not include fossil fuel for permitted ancillary purposes.
3.-(1) This paragraph applies to a generating station that is a capped generating station on commencement day.
(2) No more than A x 125,000 ROCs may be issued in respect of relevant electricity generated by the generating station during the period starting on the relevant day and ending on 31st March 2019.
(3) In sub-paragraph (2), A is the number of capped combustion units included in the generating station on commencement day.
4.-(1) This paragraph applies to a generating station that is a capped generating station on qualification day in any obligation period (the "previous obligation period") beginning with the 2018/19 obligation period.
(2) No more than A x 125,000 ROCs may be issued in respect of relevant electricity generated by the generating station during the next obligation period after the previous obligation period.
(3) In sub-paragraph (2), A is the number of capped combustion units included in the generating station on qualification day in the previous obligation period.
5.-(1) This paragraph applies to a generating station that is a mixed generating station on commencement day.
(2) By the day one month after commencement day, the Secretary of State must publish an estimate (the "exempt combustion unit estimate") of the number of ROCs which are likely to be issued in respect of relevant electricity generated by the generating station's relevant exempt combustion units during the 2018/19 obligation period.
(3) In making the estimate referred to in sub-paragraph (2), the Secretary of State must rely on the same information used to calculate the figure referred to in article 11(2) in respect of the 2018/19 obligation period.
(4) Sub-paragraph (5) applies where the number of ROCs issued in respect of relevant electricity generated by the generating station during the 2018/19 obligation period has reached the mixed generating station estimate.
(5) Where the number of ROCs issued in respect of relevant electricity generated by the generating station's relevant capped combustion units during the relevant period exceeds the capped combustion unit allowance, no more ROCs may be issued in respect of relevant electricity generated by the generating station during the relevant period.
(6) In this paragraph-
"capped combustion unit allowance" means A x 125,000 ROCs, where A is the number of the generating station's relevant capped combustion units;
"mixed generating station estimate" means a number of ROCs equal to the sum of-
the capped combustion unit allowance, and
the exempt combustion unit estimate;
"relevant capped combustion unit" means a capped combustion unit included in the generating station on commencement day;
"relevant exempt combustion unit" means an exempt combustion unit included in the generating station on commencement day;
"relevant period" means the period starting on the relevant day and ending on 31st March 2019.
6.-(1) This paragraph applies to a generating station that is a mixed generating station on qualification day in any obligation period (the "previous obligation period") beginning with the 2018/19 obligation period.
(2) By publication day in the previous obligation period, the Secretary of State must publish an estimate (the "exempt combustion unit estimate") of the number of ROCs which are likely to be issued in respect of relevant electricity generated by the generating station's relevant exempt combustion units during the next obligation period (the "relevant obligation period") after the previous obligation period.
(3) Where publication day in the 2018/19 obligation period occurs after 1st October 2018, in making the exempt combustion unit estimate for the obligation period starting on 1st April 2019, the Secretary of State must rely on the same information used to calculate the figure referred to in article 11(2) in respect of that obligation period.
(4) Sub-paragraph (5) applies where the number of ROCs issued in respect of relevant electricity generated by the generating station during the relevant obligation period has reached the mixed generating station estimate.
(5) Where the number of ROCs issued in respect of relevant electricity generated by the generating station's relevant capped combustion units during the relevant obligation period exceeds the capped combustion unit allowance, no more ROCs may be issued in respect of relevant electricity generated by the generating station during the relevant obligation period.
(6) In this paragraph-
"capped combustion unit allowance" means A x 125,000 ROCs, where A is the number of the generating station's relevant capped combustion units;
"mixed generating station estimate" means a number of ROCs equal to the sum of-
the capped combustion unit allowance, and
the exempt combustion unit estimate;
"publication day" means-
in the 2018/19 obligation period, the later of 1st October 2018 and the day that occurs one month after commencement day;
in any subsequent obligation period, 1st October.
"relevant capped combustion unit" means a capped combustion unit included in the generating station on qualification day;
"relevant exempt combustion unit" means an exempt combustion unit included in the generating station on qualification day.
7. For the purpose of determining whether ROCs are to be issued in respect of electricity generated by a mixed generating station during the relevant period referred to in paragraph 5 or during any relevant obligation period referred to in paragraph 6-
(a)this Order has effect with the modifications set out in paragraphs 8 to 18;
(b)any notification made by the operator of a mixed generating station under article 81 must be disregarded.
8.-(1) Article 2 has effect with the following modifications.
(2) In paragraph (1)-
(a)for the definition of "RO capacity" substitute-
""RO capacity", in relation to a generating station or a combustion unit, means the generating capacity of the station or the unit other than excluded capacity;";
(b)for the definition of "RO input electricity" substitute-
""RO input electricity"-
in relation to a generating station, has the meaning given in article 26;
in relation to a combustion unit, has the meaning given in article 26A;";
(c)for the definition of "total installed capacity" substitute-
""total installed capacity", in relation to a generating station, a combustion unit or generating capacity of any description, means the maximum capacity at which that generating station, combustion unit or generating capacity could be operated for a sustained period without causing damage to it (assuming the source of power used by it to generate electricity was available to it without interruption);";
(d)for the definition of "total output electricity" substitute-
""total output electricity", in relation to a generating station or a combustion unit, means the total amount of electricity generated by that station or unit;".
9. This Order has effect as if it were modified by inserting the following article after article 26-
26A.-(1) This article applies for the purposes of this Part.
(2) In any month where the total installed capacity of a capped or exempt combustion unit of a mixed generating station does not include any excluded capacity, the "RO input electricity" of the unit is equal to-
where-
A is the RO input electricity of the mixed generating station during that month (calculated in accordance with article 26);
B is the total output electricity of the unit during that month; and
C is the sum of the RO output electricity of each capped combustion unit and each exempt combustion unit of the mixed generating station during that month.
(3) In any month where the total installed capacity of a capped or exempt combustion unit of a mixed generating station includes excluded capacity, the "RO input electricity" of the unit is equal to-
where-
A, B and C have the meanings given in paragraph (2);
D is the total installed capacity of the RO capacity of the unit; and
E is the total installed capacity of the unit.".
10.-(1) Article 27 has effect with the following modifications.
(2) In paragraph (2)-
(a)for "generating station" substitute "capped or exempt combustion unit of a mixed generating station";
(b)for "station" both times it appears substitute "unit".
(3) In paragraph (3)-
(a)for "generating station" substitute "capped or exempt combustion unit of a mixed generating station";
(b)for "station" each time it appears substitute "unit".
(4) In paragraph (4)-
(a)for "generating station" substitute "capped or exempt combustion unit of a mixed generating station";
(b)for "station" each time it appears substitute "unit".
11.-(1) Article 28 has effect with the following modifications.
(2) In paragraph (1)(a) for "in respect of a generating station's RO eligible renewable output in a month" substitute "in respect of the RO eligible renewable output in a month of each capped combustion unit and each exempt combustion unit of a mixed generating station".
(3) For paragraph (4) substitute-
"(4) When issuing ROCs in respect of electricity generated in a month by a mixed generating station, the Authority must-
(a)determine the RO eligible renewable output of each capped combustion unit and each exempt combustion unit of the generating station in that month in accordance with article 29 or 30 (whichever is applicable); and
(b)issue ROCs in respect of each such unit's RO eligible renewable output, the amount of electricity to be stated in each ROC being determined in accordance with articles 31 to 41.".
12.-(1) Article 29 has effect with the following modifications.
(2) In paragraph (1) for "generating station" substitute "capped or exempt combustion unit of a mixed generating station".
(3) In paragraph (2) for "station" each time it appears substitute "unit".
(4) In paragraph (3) for "generating station" substitute "capped or exempt combustion unit of a mixed generating station".
(5) In paragraph (4)-
(a)for "station" each time it appears substitute "unit";
(b)in sub-paragraph (e) for "station's" substitute "unit's".
(6) In paragraph (5) for "generating station" substitute "capped or exempt combustion unit of a mixed generating station".
13.-(1) Article 30 has effect with the following modifications.
(2) For paragraph (1) substitute-
"(1) This article applies to a capped or exempt combustion unit of a mixed generating station that is a qualifying CHP station in any month during which the unit generates electricity from waste (other than waste which constitutes biomass, is used by the unit for permitted ancillary purposes, is an advanced fuel or is in the form of a liquid or gaseous fuel produced by means of anaerobic digestion).".
(3) In paragraph (2) for "generating station" substitute "combustion unit".
(4) In paragraph (3)(b) for "the station" substitute "the mixed generating station that includes the combustion unit".
14.-(1) Article 31 has effect with the following modifications.
(2) In paragraph (3)-
(a)for "generating station" substitute "capped or exempt combustion unit of a mixed generating station";
(b)for "station's" substitute "unit's".
(3) In paragraph (4) for "station" each time it appears substitute "unit".
15.-(1) Article 32 has effect with the following modifications.
(2) In paragraph (3)-
(a)for "generating station" substitute "capped or exempt combustion unit of a mixed generating station";
(b)for "station's" substitute "unit's".
(3) In paragraph (4)-
(a)for "station" each time it appears substitute "unit";
(b)for "station's" each time it appears substitute "unit's".
16.-(1) Article 43 has effect with the following modifications.
(2) After paragraph (2) insert-
"(3) ROCs are not to be issued in respect of any electricity generated by a mixed generating station unless-
(a)the electricity generated by each capped combustion unit and each exempt combustion unit of the station is measured separately using a meter referred to in paragraph (2)(a); or
(b)the Authority has agreed that estimates may be provided instead of separate measurements.".
17.-(1) Article 80 has effect with the following modifications.
(2) In paragraph (2)-
(a)for "generating station" substitute "mixed generating station";
(b)in sub-paragraph (b) for "of the station" substitute "of each capped combustion unit and each exempt combustion unit of the station".
18.-(1) Schedule 5 has effect with the following modifications.
(2) In paragraph 1(1) of Part 1-
(a)omit the definition of "station conversion";
(b)omit the definition of "station conversion with CHP";
(c)in the definition of "unit conversion" omit paragraph (b) (and the "and" that precedes it);
(d)in the definition of "unit conversion with CHP" omit paragraph (b) (and the "and" that precedes it).
(3) In Part 2 in the table omit the whole row whose first entry is "station conversion".
(4) In Part 3 in the table omit the whole row whose first entry is "station conversion".
(5) In Part 5 in the table omit the whole row whose first entry is "station conversion with CHP".
(6) In Part 6 in the table omit the whole row whose first entry is "station conversion with CHP".
(7) In Part 7 in the table omit the whole row whose first entry is "station conversion with CHP".".
Claire Perry
Minister of State for Energy and Clean Growth
Department for Business, Energy and Industrial Strategy
19th July 2018
(This note is not part of the Order)
This Order amends the Renewables Obligation Order 2015 (the "2015 Order") to provide for an annual ROC cap and makes other minor amendments.
The 2015 Order imposes, on all electricity suppliers licenced under the Electricity Act 1989 which supply electricity in England and Wales, an obligation (the "renewables obligation") to produce a certain number of renewables obligation certificates ("ROCs") in respect of each megawatt hour of electricity they supply to customers in England and Wales during the periods known as "obligation periods". Each obligation period runs from 1st April to 31st March.
The renewables obligation is administered by the Gas and Electricity Markets Authority ("the Authority") which issues ROCs to accredited renewable electricity generators based on their output. These certificates are sold to electricity suppliers with or without the associated renewable electricity.
Article 3 amends article 28 of the 2015 Order so that it is subject to a new Schedule 6 (inserted by article 6 of this Order) which caps the number of ROCs that can be issued in respect of "relevant electricity" generated by certain types of generating station during each obligation period. Relevant electricity is electricity that has been generated in certain ways described in paragraph 1 of new Schedule 6 (using either biomass or bioliquid as fuel).
New Schedule 6 also defines two types of generating station: "capped" and "mixed" generating stations (at paragraph 1). A capped generating station is a "relevant fossil fuel station" that includes one or more "capped combustion units" and no "exempt combustion units". A mixed generating station is a relevant fossil fuel station that includes both capped and exempt combustion units. "Relevant fossil fuel station" has the meaning given in Part 1 of Schedule 5 to the 2015 Order, but excludes a station that has previously received ROCs for generation of electricity described as dedicated biomass, including dedicated biomass with ‘combined heat and power' (‘CHP'). A CHP station is one which generates electricity and which is also able to supply heat to premises.
New Schedule 6 also defines two new types of combustion unit which a generating station may comprise (at paragraphs 1 and 2). Both definitions relate to combustion units which are accredited to participate in the Renewables Obligation scheme and to electricity which would, but for this Order, entitle the relevant generating station to be issued with ROCs:
"capped" combustion units, so-called because they will be subject to either an actual or notional cap of 125,000 ROCs. A capped generating station will receive no further ROCs once it has been issued 125,000 ROCs multiplied by the number of capped combustion units of which the station consists (the "capped combustion unit allowance") (paragraphs 3 and 4 of new Schedule 6). Electricity generated by capped combustion units forming part of a mixed generating station will not be issued with ROCs where the station has been issued with ROCs to the level of its "mixed generating station estimate" and where the capped combustion unit allowance has been exceeded. The mixed generating station estimate is the sum of the capped combustion unit allowance plus an estimate, made by the Secretary of State, of the number of ROCs the station's exempt combustion units are likely to be issued in that obligation period (the "exempt combustion unit estimate").
"exempt" combustion units, so-called because they will remain entitled to receive ROCs for the electricity they generate, unless they form part of a mixed generating station. In this case, exempt units will be eligible to receive ROCs, except where the mixed generating station estimate has been reached and where the station's capped combustion units have been issued more ROCs than the capped combustion unit allowance (paragraphs 5 and 6 of new Schedule 6). Combustion units are exempt where they form part of a relevant fossil fuel station and where they have been issued with ROCs prior to 12 December 2014 for electricity described as "unit conversion" or "station conversion", unless certain exceptions apply (paragraph 2).
Paragraphs 7 to 18 of the new Schedule 6 modify the 2015 Order so that, for a mixed generating station, the provisions of the 2015 Order which would otherwise provide for the apportionment of ROCs to the entire station instead provide for the apportionment of ROCs to individual combustion units. The modifications include provision for the following:
mixed generating stations must use a meter to measure the amount of electricity generated every month by each combustion unit separately and provide the information to the Authority, unless the Authority agrees that estimates may be provided instead (see modifications made to article 43 of the 2015 Order by paragraph 16 of new Schedule 6 and to article 80 by paragraph 17 of new Schedule 6);
the "input" electricity (i.e. electricity used by each combustion unit for purposes related to its operation and which is deducted from electricity generated before ROCs are issued) does not need to be measured separately, but is a deemed figure, calculated by reference to the input electricity of the mixed generating station as a whole (see modification made by paragraph 9 of new Schedule 6, which inserts new article 26A);
any notification previously given by the operator of a mixed generating station under article 81 of the 2015 Order must be disregarded (see paragraph 7(b) of new Schedule 6). The effect is that the actual energy content of biomass burned must be used for the purpose of calculating the number of ROCs to be issued.
Article 3 of this Order also makes certain corrections to article 28 of the 2015 Order.
Article 4 amends article 35 of the 2015 Order. The operator of a generating station that was accredited on or before 31st March 2013 and becomes a "qualifying CHP station" (as defined in article 2(1) of the 2015 Order) on or after the date on which this Order comes into force must make a declaration to the Authority in order to be entitled to ROCs issued at the CHP bands set out in the table in Part 5 of Schedule 5 of the 2015 Order in respect of electricity generated by the station's "pre-2013 capacity" (as defined in article 2(1) of the 2015 Order). The declaration must state that support for heat produced by the use of that capacity has not been given under a scheme established under section 100(1)(a) of the Energy Act 2008. If no such declaration is made, ROCs will be issued at the non-CHP bands set out in the table in Part 2 of Schedule 5. This does not apply to microgenerators or electricity to which article 36 applies.
Article 5 amends the definition of "post-2013 dedicated biomass station" in paragraph 1 of Schedule 2 to the 2015 Order to make it clear that the term includes a generating station that was not accredited on or before 31st March 2013 and has, in any month after March 2013, generated electricity described as "dedicated biomass with CHP" in Schedule 5.
An explanatory memorandum is available alongside this Order on www.legislation.gov.uk. A full regulatory impact assessment of the effect that this instrument will have on the costs of business and the voluntary sector is available alongside this Order on that website or from the Renewable Electricity Support Schemes Team, Department for Business Energy and Industrial Strategy, 1, Victoria Street, London, SW1H 0ET.
1989 c. 29, sections 32 to 32M were substituted by section 37 of the Energy Act 2008 (c. 32) for sections 32 to 32C. Section 32L(1) has been amended by S.I. 2014/631. There are other amendments to sections 32 to 32M which are not relevant.
The National Consumer Council was abolished by article 2 of S.I. 2014/631. Article 3(1)(b)(ii) of, and Schedule 1 to, that Order transferred the National Consumer Council's functions under section 32L(1) of the Electricity Act 1989 to the National Association of Citizens Advice Bureaux and the Scottish Association of Citizens Advice Bureaux. Paragraph 28(1) of Schedule 1 to that Order provides: "Nothing in this Order affects the validity of anything done (or having effect as done) by or in relation to the National Consumer Council before the coming into force of articles 2 and 3."
S.I. 2015/1947, as amended by S.I. 2016/1108, S.I. 2017/1234 and S.I. 2017/1289.
