United Kingdom

United Kingdom

Minister says regulator must change new electricity trading arrangements to help wind

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Environment Minister Michael Meacher has added his voice to the growing number of organisations concerned about the effects of Britain's new electricity trading arrangements (NETA) on small generators. Meacher is the first government minister to criticise NETA, which was introduced by energy regulator Ofgem at the end of March. NETA penalises generators who cannot guarantee their output in advance -- such as wind farms and small combined heat and power (CHP) plants. Based on a balancing principle, NETA requires generators to forecast the amount of energy they will supply 3.5 hours ahead. The system then punishes any "imbalance": if they supply less than predicted they pay market price for the shortfall, if they over-supply they receive a lower price for the excess -- and in some cases have to pay for over-supplying. "There is a real problem with NETA for small companies. We have got to persuade Ofgem that they have got to be safeguarded," said Meacher at the Parliamentary Renewable and Sustainable Energy Group's conference in July. He added: "We will be active in supporting small generators. Small generators have a very important role to play."

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