RenewableUK CEO Maria McCaffery outlines successes and challenges for UK renewable energy industry

November 3rd, 2011 by RenewableUK

Maria McCaffery, CEO of RenewableUK, introduces the Plenary session of the annual conference in Manchester on 25 October 2011 (click image to expand - ©RLLord)

Tony Juniper has recently accepted the role of Chairman of our new grassroots campaign, Action for Renewables, which brings together businesses, trade unions, NGOs, parliamentarians, and activists in a group that is dedicated to the expansion of all forms of renewable energy.

It is also a great pleasure to introduce to you, Matthew Chinn, Managing Director of Siemens Energy in the UK. Matthew, thank you so much for your company’s generous sponsorship of this year’s RenewableUK annual conference.

Despite the economic downturn and increased policy uncertainty the UK’s renewable energy industry has continued to deploy.  This has, yet again, been a record breaking year.  In the last quarter, generation from renewable energy resources in the UK reached a record high supplying almost ten percent of our electricity for the first time ever and that is up 50% from the same time last year.

The contribution from wind alone in this period increased by more than 120% and is now generating enough power to supply nearly 3.25 million homes in the UK.

Last month we also saw the highest ever recorded amount of electricity generated by wind for networks at any one time. Over a 24 hour period from the 6 to 7 September 2011 wind turbines alone were generating 4,500 MW of electricity supplying more than 10% of the UKs total electricity needs.

The technologies we represent continue to be deployed at an unprecedented pace and this looks set to continue until 2012.

In July 2011, after seven years of campaigning, we won guarantees of compensation from oil and gas developers over disputed offshore wind leases.  This removed a major barrier to investment in the sector and will mean wind developers can compete on a level playing field with their oil and gas counterparts.

We have also seen continued growth in onshore wind deployment, the least expensive form of renewable energy.

The industry has been working closely with the UK government to ensure that the proposed planning reforms do not inhibit development, especially the delivery of sustainable infrastructure. For example, RenewableUK recently led the successful campaign to persuade the UK government to drop the proposed referendums on planning decisions that were contained in the Localism bill.

Moving with the Coalition’s localist approach to planning and development, RenewableUK also launched an industry-wide community benefit protocol alongside the UK Department of Energy and Climate Change (DECC) in February 2011.

Another big industry win has come in the field of wave and tidal technology development to further cement our world-leading position in this sector.

The Renewables Obligation Banding Review published in the week of 17 October 2011, proposes to increase significantly the financial support for both wave and tidal technology, increasing support to 5 ROCs per MW.

Also the combined total of almost £40 million in upfront capital support from Westminster and the Scottish government for technology development will, we hope, ensure that projects are deployed at scale over the next year or two at the same time driving innovation and helping lower cost.

And finally, but by no means least, the sector we have been please to call ‘small wind’ and I am now advised that ‘distributed wind’ is a more apt description, has also seen significant growth.  Permitted development rights are finally being introduced for domestic installations and this looks set to increase interest in the sector.

We have had many success stories over the last 12 months – not least the lobbying around the 2020 Renewable Energy Roadmap and the Electricity Market Reform white paper.

Recent and past success should not encourage complacency. We have to look forward to building a policy framework that would foster continued growth.

With our rich wind, wave and tidal resource, we must build on our current lead in the off-shore wind, wave, and tidal sectors and become a global industrial hub for renewables.  The rewards are substantial. By 2020, we could realistically see 35 GW of installed wind, wave and tidal capacity. We could see a third of our electricity generated by renewable resources.

We could see a further £85 billion of investment injected into our economy, and almost 90,000 new jobs created in twenty new factories at a minimum. Getting there isn’t going to be easy.

Just because we have the resource and the current lead in technology innovation doesn’t guarantee that the UK will reap the long term economic benefits that will come with such development. We have to adjust to the fact that the two pillars that sustained early growth – the supporting framework and an economic boon cannot be relied on to the same extent anymore and times really are tough.

The UK government has cut spending and raised taxes, meaning the industry will need to justify every penny of support like never before. And this is going to mean knuckling down and driving down waste.

Key to this will be winning the debate on costs which has dominated coverage in the media recently. The industry is under great pressure from an extremely well-organised but misguided faction of parliamentarians and the media that claim that it is the increased support for renewable energy development that is adding to consumer bills.

Support for renewable energy is in fact only a very small contributor to the rise in energy bills.

However, as we know from the battle over the offshore wind deployment scenario for the 2020 Renewables Roadmap and George Osborne’s speech at the Conservative Party Conference a few weeks ago, the treasury is trying to reign back the Coalitions overall commitment to de-carbonising the economy and the 2020 renewables targets in particular.

These groups are looking to pit the green agenda against the Coalition’s growth agenda. We need to combat this head-on.

We are part of the solution; not the problem. If we want growth we must go green. If we go green we get growth.

As we commercialise our technologies, cost will, we are confident, come down. We as an industry are committed to this. It is a major factor to why we gave so much encouragement to the UK government for setting-up the Offshore Wind Cost Reduction Task Force headed up by the Chairman of RenewableUK, Andrew Jamieson, of ScottishPower Renewables. This expert panel will seek to find solutions that will drive down the cost of offshore wind hopefully by one third by the end of the decade.

We absolutely must win this battle and better communicate the benefits of increased renewable deployment, better communicate the hard economic benefit that growth in this sector will bring to local communities as well as the nation as a whole.

As our industry grows and as we cement our world leadership position in this sector, we will inevitably attract more attention and scrutiny and rightfully so.  This is the price of success. And with success and leadership comes greater responsibility.  Responsibility on both government and our industry.

It is the responsibility of government to set a stable political and economic framework through reforms of the planning system, the electricity market, and the renewable support mechanism giving industry the space and room to thrive. And if the responsibility on industry to attract the investment, to build the factories, create the jobs, and better engage with communities affected by this development, and its our job as the leading national trade association for renewable energy in the UK to help shape the debate in order to give you the chance to deliver on the ground.  But working together, I believe we can transform the UK into the renewables powerhouse it promises to be.

We are a critical component in the UK governments growth agenda. We are part of the solution, not the problem. We are stimulating growth, not holding it back.   Thank you.

 

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