Support for small-scale solar PV in Northern Ireland to fall under changes to Renewables Obligation

Out-Law News | 08 Jul 2014 | 12:29 pm | 2 min. read

Support for small-scale solar photovoltaic (PV) generation in Northern Ireland would fall dramatically from next year under plans put forward for consultation by the Department of Enterprise, Trade and Investment (DETI).

Under the Northern Ireland Renewables Obligation (NIRO), support for solar PV installations under 250kW will fall from four Renewables Obligation Certificates (ROCs) per megawatt hour (MWh) generated to 1.6 ROCs from 1 April 2015. Eligible schemes which are unable to accredit by the 31 March 2015 deadline due to grid connection delays would be able to benefit from a six month grace period, according to DETI’s consultation (41-page / 897KB PDF).

Arlene Foster, minister for enterprise, trade and investment, confirmed that the NIRO would close to new entrants in 2017, in line with the UK-wide Electricity Market Reform (EMR) programme. Large scale renewable electricity will instead be supported under a contract for difference (CfD) mechanism, while a small scale feed-in tariff (FiT) would be introduced for smaller projects, she said.

“Our aim remains to bring forward renewable technologies to achieve our renewable energy target while delivering value for money for consumers,” she said.

“The NIRO has been instrumental in bringing forward ever increasing levels of renewable electricity generation since its introduction in 2005. The Northern Ireland executive’s current Programme for Government includes a target to secure 20% of electricity consumption in Northern Ireland from renewable sources by 2015 and we are well on our way to meeting this target,” she said.

In a similar way to the Renewables Obligations (RO) operating elsewhere in the UK, NIRO is the main financial support mechanism used by the Northern Ireland executive to encourage the development of large-scale renewable electricity generation projects. It places an obligation on suppliers to source an increasing proportion of the electricity they supply from renewable sources. Banded ROCs were introduced in 2009, changing the RO from offering a single level of support for all renewable technologies to one where support levels vary in relation to the cost of developing that technology and its future potential.

DETI’s consultation, which closes on 25 September, proposes that support levels for most of the technologies reviewed remain unchanged until the scheme closes in 2017. Onshore wind installations up to 250kW would continue to receive four ROCs/MWh, while larger schemes up to 5MW would continue to receive one ROC/MWh. Anaerobic digestion bandings would remain at four and three ROCs/MWh respectively; while hydro support would remain at three and four ROCs/MWh respectively.

“The purpose of this latest review is to ensure that incentive levels reflect changes in technology costs and deployment of small scale renewables over time,” said Foster.

“However, I recognise that there are wider issues around the deployment of renewables. This includes the ability of the grid to absorb increasing levels of renewable electricity, the impact on the landscape, particularly from single wind turbines, and community involvement,” she said.

"This consultation has been long-awaited by stakeholders involved in the small/medium sector in Northern Ireland," said energy law expert Laura Donnelly of Pinsent Masons, the law firm behind Out-Law.com.

"Whilst the proposals in relation to solar PV largely follow the reductions to support levels that we have seen in Great Britain recently, it is encouraging that DETI is minded to continue with the existing levels of support for anaerobic digestion and small/medium onshore wind; sub-sectors that need the right policy environment to continue to grow and develop," she said.