Ofgem proposals for 95% embedded benefits cuts will raise councils’ waste costs, warns ESA

Written by: Editorial staff | Published:

The Environmental Services Association (ESA) has raised concerns over proposals to reduce embedded benefits to small decentralised generators by 95%.

Ofgem has announced its intention to cut the payments from £45/kW to £2/kW, which are expected to hit small-scale renewables, including waste-fuelled electricity generated by energy from waste, anaerobic digestion and landfill gas.

ESA’s executive director, Jacob Hayler said: "These cuts will not only cause serious damage to the UK's transition to low-carbon energy sources, but will threaten our resource efficiency ambitions by raising costs of waste management for local authorities and disincentivising resource efficient use of waste as a fuel.

"Network charging is highly complex and we are concerned that Ofgem is rushing through changes that will have unintended consequences. Energy generated from waste is a reliable source of low-carbon baseload electricity which contributes to the UK's security of supply whilst keeping costs down for consumers. Ofgem appears to be ignoring this and will inadvertently force smaller more sustainable generators out of the market. Rather than targeting embedded benefits in isolation, Ofgem should undertake a holistic review of network charging to avoid wider distortions," said Hayler.

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