Utility Week

UTILITY Week 7th November 2014

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Page 13 of 31

UTILITY WEEK | 7Th - 13Th NovEmbEr 2014 | 13 Policy & Regulation This week No state subsidies for interconnectors Development of future links must be funded commercially, energy minister tells mPs The government will not subsi- dise the development of intercon- nectors, the Energy and Climate Change Committee was told on Tuesday. Energy minister Matthew Han- cock told MPs the government would not fund any interconnec- tors and that they would have to be commercially financed. He told the committee: "Building interconnectors needs to be paid for, so it needs to be a decent commer- cial proposition for those going to pay for them because we don't propose to pay for them from the Department of Energy and Climate Change. "There is a clear revenue stream to make them a viable commercial proposition." Interconnectors will provide a return when there is a price differential between the interlinked markets, and energy flows across the link. The interconnector operator is paid for transporting the energy. The energy minister accepted that developing interconnectors would create "planning and logistical challenges" for the UK's transmission system, but said "they come with the same impacts on transmission as a new power station built offshore." Hancock dismissed the notion that the potential for interconnectors to export energy out of the UK was a threat to energy security, calling them "the first best response to a tightening [margin]". He also said that greater interconnection would also have "a positive price impact by making the market more liquid". MB WaTEr Catchment scheme extended to 2014/15 The Department for Environ- ment, Food, and Rural Affairs (Defra) has extended its pilot scheme to improve water quality and catchment management. Defra provided £274,000 for 11 payments for ecosystems services (PES) pilot projects between 2011 and 2013 designed to improve water quality, man- age flood risk, and improve the local ecosystem. There will be a new funding round for 2014/15. PES pilots let a "willing buyer" of an ecosystem service, such as catchment management, voluntarily pay a "seller" or landowner to adopt a series of measures to ensure the provi- sion of that ecosystem. In a review of the first two funding rounds, Defra found that the PES scheme "can deliver cost-effective environmental outcomes". ENErgY 'Prejudice' behind cut in solar subsidy The environment secretary has an "ideological prejudice" against large scale, ground- mounted solar farms, according to Labour. Shadow environment secre- tary Maria Eagle said Elizabeth Truss had "no underpinning evidence" for her department's decision to remove subsidies for farmers who place solar farms on agricultural land. Eagle also asked Truss whether "her priority should be cutting Britain's ability to generate clean electricity" when capacity margins are at their lowest for seven years. Truss responded: "Food and farming is one of our largest industries and contributes £100 billion to the economy, and there are 250,000 hectares of commer- cial roofs where solar panels can be located." The change will come into effect in January 2015. ENErgY UK 'on track to meet 2020 climate targets' The UK is one of only nine EU countries on track to meet all three of the 2020 EU climate targets, says a report from the European Commission and the European Environment Agency. The annual progress report on emissions, energy efficiency and renewables targets found the EU as a whole on track to meet its emission reduction target of 20 per cent. According to the report, emissions in 2012 reached their lowest levels of 18 per cent below those in 1990. A further reduction in emis- sions of 1.8 per cent from 2012 to 2013 resulted in an estimated emission reduction overall of 19 per cent on 1990 levels. New links must be commercially viable Political Agenda Mathew Beech Eagle attacks Tories for undermining solar power On the 40th anniversary of the Rumble in the Jungle between Muhammad Ali and George Foreman, Labour's shadow environment secretary wanted to knock out her opposite number. In Defra orals, Maria Eagle attacked Elizabeth Truss, and the Conservatives, for having an "ideological prejudice" against large, ground-mounted solar. This followed the govern- ment's statement that farmers will no longer receive subsidies under the EU Common Agricul- She said these fields – that the NFU says can support agriculture and solar farms – should be used to boost the UK's dwindling energy capacity. Truss, shouting ever louder, failed to answer the question of a lack of evidence. Heavy blows were traded, but no knockout punch was landed. Eagle was on the front foot, but Truss and the Tories will hope to weather the storm and launch a fight back of their own, as Ali did in Zaire in 1974. tural Policy if they cover their fields with solar panels. Truss said putting the "unsightly" panels on prime agricultural land will harm the rural econ- omy and jeopardise the Tories' long-term economic plans. "Evidence! Where is the evidence?" cried Eagle and the shadow Defra team. Using Ali's rope-a-dope tac- tics, Truss soaked up the press- sure then hit back saying solar panels should be put on commer- cial and industrial rooops. But, seizing the moment and using the publication of National Grid's Winter Outlook to back up her argument, Eagle counter- punched once more.

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