“My Government will propose reform of the electricity market to deliver secure, clean and affordable electricity and ensure prices are fair”, the Queen said.
The Energy Bill aims to reform the electricity market to enable large-scale investment in low-carbon generation capacity in the UK and deliver security of supply, in a cost-effective way.
“This is crucial legislation. The Energy Bill would reform the electricity market to keep the lights on and emissions down in a more cost-effective way, while reaping the economic benefits. It is designed to provide investors with long-term certainty and incentives to invest in low-carbon,” said a Department of Energy and Climate Change (DECC) spokeswoman. “We will shortly publish a draft Bill for pre-legislative scrutiny, to enable swift passage of well-considered legislation. We are publishing the Bill in draft in order to speed up its passage through Parliament and to enable pre-legislative scrutiny which will help make the legislation more robust.”
DECC had previously denied rumours that the Energy Bill could be delayed or downgraded to make way for alternative legislation such as the controversial House of Lords reforms, however DECC said in a press statement after the Queen’s speech that the bill will be put before Parliament in the coming months, which “will not delay the date at which the reforms are introduced”.
“We anticipate legislation reaching the statute book by 2013 so that the first low-carbon projects can be supported (as we originally envisaged) in 2014," DECC said.
Commenting on the content of the Queen’s Speech, Gaynor Hartnell, Chief Executive of the Renewable Energy Association said: “We look forward to seeing the details of the Energy Bill. This is of immense importance to project developers in renewables, as the measures it puts in place will eventually replace the Renewables Obligation. Many of the projects in development now are working to a timescale that takes them into the new regime, and they need to know the detail as soon as possible.”
Hartnell points out that the new arrangements aim to deliver a stable price for renewable electricity generators, irrespective of what happens to electricity prices. If all works as intended, it should make project development less risky and means that the public pays no more than it needs to for green power.
“We are also awaiting the Government’s conclusions on the subsidy levels coming into effect from April next year under the current policy, the Renewables Obligation,” continued Hartnell. “It was originally intended that the legislation setting out how many Renewables Obligation Certificates generators would earn for their power output from 2013 onwards would be in place a full year ahead. This would have given project developers absolute confidence to progress their plans. As it stands we could know the intended levels later this month but won’t see the legislation until the autumn.”
The Queen also confirmed that the Department of Business, Innovation and Skills had put together a new enterprise bill containing the legal framework for the much anticipated Green Investment Bank.
Backed by £3 billion of public funds, it is hoped that the Green Investment Bank will leverage a further five times as much private sector funding for a plethora of clean energy projects.
While a transitional team is already in place to roll out the bank and the first wave of funding (for the waste and recycling sector) was allocated last month, the bank cannot be formally launched until the legislative framework is in place and the Government receives state aid approval from the European Union.
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