Tees Renewable Energy Plant is hit by policy delays
By Stew Robinson
There are two main types of Biomass Plants/Facilities.
The first type of Biomass Plant converts either plant or animal based matter into either heat, to generate electricity, or bioethanol which can be used to mix with fossil fuels or in fuel cells to generate electricity.
The second type of Biomass Plant converts Municipal Solid Waste (MSW) into either heat, to generate electricity, or bioethanol as mentioned above.
The proposed Biomass Plant at Teesport is to be a Wood Chip Plant with a proposed output capacity of 300 megawatts of power.
MGT Power, the developer of the Tees Power Plant, publicised its plans for the project in 2008 and had hoped to have the plant in process by 2012.
MrElsworth, of MGT Power, says he has a group of people working to implement this Biomass Plant focusing on investment.
Mr. Elsworth, continued that there were a number of uncertainties, however, they still intended to spend a lot of money on the project, and that they would not be progressing with this, if they did not have belief and faith, that this made sense for the UK.
MrElsworth also said that the delays were a major factor, however, they expected this uncertainty will be resolved early in Autumn.
The Renewable Energy Association’s (REA) head Gaynor Hartnell has said that the UK is faced with a possible capacity crunch in 2015-16. Most of the projects that have been proposed today could already be operational, had the government not prolonged clarity and their lack of policy changes.
The DECC has also decided to place a capacity ceiling of 400 megawatts on new projects to forcibly curtail the development of new projects that will qualify for the Renewables Obligation subsidy prior to March 2017
This cap is “Deeply Flawed” according to the REA who think this will cause investors to hasten their project completion dates to be finalised before the envisaged deadline.
According to the REA’s Ms. Hartnell, in regard to the Government’s proposed cap.
The irony of this is the DECC should have been welcoming these projects, instead they are turning them away.
There are also plans by the Government to bring in another type of Subsidy in place of ROCs (Renewable Obligations Certificates). There is no clarity on this Subsidy system and how it will work, giving further rise to investor’s hesitance to invest in Biomass projects.
Another “chip” holding up the project is the UK’s Department of Climate Change (DECC) hesitation over subsidy formalisation on new plants, which is giving investors a lot to worry about, as they don’t want to commit themselves before the subsidies are ratified, as they need to know the potential returns before committing their resources.
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