Rolf Stein’s pick of events for 2011 and looking forward to 2012…

Written by Rolf Stein, CEO, Advanced Plasma Power

2011 was a eventful year for the renewable energy industry.  Public and political opinion has run the gamut, from wild enthusiasm to cool indifference and, from some, outright hostility.  The Fukushima disaster threatened to set renewable nuclear energy back a generation; while the Arab Spring threatened oil supplies and caused some to question fossil fuel dependence.  The UK Government set world-leading emmissions targets; which the Treasury later claimed threatened British jobs.  All this against the continuing backdrop of the worst financial crisis in a generation.  Yet, for all that, there are certainly reasons to be cheerful as we look forward to the year ahead. 

Here is my pick of the events that made an impact in 2011, and what to keep an eye out for in 2012. 

–  In 2011 the effects of climate change were pushed  to the forefront of the world’s attention., with extreme weather seen across the world. In March, a giant tsunami damaged the Fukushima nuclear plant in Japan, causing global panic as rumour spread of a second Chernobyl.  The impact on the nuclear industry was mixed; Germany announced a complete withdrawal from nuclear power by 2022, but the UK remained supportive of nuclear power generation.
–  Closer to home, British politicians did not shy away from tackling climate change.  In May, Energy Secretary Chris Huhne announced legally-binding UK emissions targets.   The ‘Carbon Budget’ commits the UK to a 50% reduction in emissions by 2025 according to 1990 levels; and an 80% reduction by 2050.  The UK now has the most ambitious emissions targets of any developed country. 
–  In October, the Government released the Renewables Obligation Banding Review.  This proposed cutting subsidies to several renewable energies, including biomass and hydroelectricity.  Industry response was mixed with biomass and hydroelectricity representatives concerned about future investment levels. 
–  In the same month, the Government announced that it intended to cut Feed in Tariffs for solar PV systems by half.  The news was met with outrage by solar panel providers, who claimed that thousands of jobs would be put under threat.  Following a legal challenge from Friends of the Earth and two renewable power companies, the cut was judged ‘premature and unlawful’.  
–  In December, all eyes were on Durban for the latest round of global climate talks.  Opinion was divided on whether or not the talks were a success, but member nations did agree to start work on a new emissions target agreement, ‘with legal force’.  
–  Following on from the Review, DECC announced a RO Banding Consultation.  The Consultation will close in January 2012, after which the Government has three months to respond. This brings us on to…

Looking forward to 2012….
–  Feed-in Tariff (FIT) scheme scheduled for appeal. Following a review towards the end of last year which judged that government plans to rush through the cuts to FITs were “legally flawed”, DECC lodged grounds for appeal, with the hearing scheduled for 13 January. We will await to see whether DECC’s proposed approach to implementing new tariffs for solar PV will go ahead…
–  RO Consultation response.  DECC’s Renewables Obligations Banding Consultation will close mid January – the Government subsequentlyhas three months to respond.  With controversy still swirling around unpopular changes to FiTs, the industry will be keen to see how DECC respond to this.       
–  A predicted rise in the carbon price.  Good news for low-carbon energy producers – at the end of 2011, the EU Parliamentary Environmental Committee backed proposals to cut carbon permit supplies, thus pushing up demand and the carbon price.  Further changes, such as fixing of emission auctioning, are expected by the end of 2012.  The effect of this should be to make low-cardon energy an attractive investment.
–  Green Investment Bank to begin investing. Initial ppointments to the long-awaited Bank will be made in Spring 2012.  Priority areas include waste processing and energy from waste facilities.  In the next financial year, £100million will be invested in waste projects.  
–  Renewable Heat Incentive extended to domestic properties  – Launched in November 2011, the RHI provides a guaranteed income to buildings that install a renewable heating system; including systems run on municipal solid waste, such as those produced by APP.  The scheme will be extended to domestic properties in October 2012, and, as energy prices look set to rise, hopefully this incentive will generate renewed interest in alternative heating sources. 

However, if 2011 has taught us anything, it’s that the green energy industry is nothing if not unpredictable.  The extreme weather and natural disasters seen in 2011 certainly focused minds on climate change; but let’s hope that it won’t take anything as drastic as that to keep renewables in the spotlight in 2012.

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