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Action urged on free market strategies

The future for community wind schemes after full liberalisation of the UK electricity market in 1998 emerged as a major concern of the British Wind Energy Association's Community Ownership Committee at its seminar in late May. Urgent action is needed now to influence regulations governing electricity trading in the free market so that community schemes get a better deal, said chairman Garry Jenkins.

One of the key issues is support for community wind projects once the Non Fossil Fuel Obligation (NFFO) is phased out, said Jenkins. NFFO support is expected to deliver its last round of contracts in 1998. From then on small as well as large customers will be able to choose their electricity supplier, opening the way for "second tier" suppliers to access a further 23 million customers. In anticipation of the post-1998 market, Jenkins said the committee needs to examine new ways of getting people to buy and sell electricity from wind projects and create ways in which community wind can work within the supplier chain.

The Office of Electricity Regulation (OFFER) is co-ordinating much of the work that needs to be done to get electricity trading regulations in place in time for 1998. David Thorne from OFFER explained: "What we have tried to do in the supply licences is make sure the domestic customer continues to be protected, but give second tier suppliers the opportunity to enter niche markets," he said, admitting that striking a balance between these two aim was difficult. He invited comments on community schemes beyond 1998 so that OFFER could take them into account in the final electricity trading regulations.

The seminar heard how community wind in Britain was at last on the point of becoming a reality. Many of the structural elements are now in place and there are real schemes close to being realised, said Jenkins. He pointed out that there is now clear advice for groups on how to set up community schemes. A leaflet, "Community involvement in renewable energy projects," was recently published by ETSU, the Department of Trade and Industry's (DTI) Energy Technology Support Unit.

But for the near future the current set-up of NFFO still remains an obstacle for community developments, Jenkins claimed. Applying for a power purchase contract is a "lottery risk," he stated. "It is an enormous gamble and small developments just do not have enough money to go through the NFFO process." Among measures that the committee will be lobbying the DTI for is a reduction of the NFFO entry fee so that community wind developments can become a realistic option.

Richard Kettle from the DTI pointed out that small wind schemes under the last two rounds of the NFFO have not fared as successfully as large projects in gaining planning permission. Moreover, on figures so far available, the rate of planning rejections has risen for all wind schemes in the latest NFFO round. "There is a challenge here for wind project developers, but maybe the situation is not quite as bleak as the numbers suggest." He outlined work supported by the DTI to encourage small and community renewable energy schemes. He claimed the government is specifically looking to encourage small projects under NFFO, but he lamented the lack of progress. "There is an opportunity for community ownership, but it is an opportunity that not a great deal has been made of," he commented.

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