This is where the chance for alternative methods of power generation could arise. With the government's energy review due in spring, it is set to outline plans to move renewable energy sources into the market. Norton believes it will be a few years before renewables are a main stream energy source, but also that the government has no choice but to encourage them: "Renewables entry into the market will be over a much longer period of time. Over the next seven or eight years, certainly by 2010, a lot of the coal fired power stations will have to go. That's the core part of the review."
The methods government will use to increase take up of renewables are more than likely to reflect the Renewables Obligation scheme, an initiative which has proved successful so far. Companies must possess Renewable Obligation Certificates (ROCS) as proof of use of a defined amount of renewable energy. ROCS can then be traded, thus opening up the possibility for financial gains. Norton explains: "We already have Renewable Obligations, and if renewables are being supported in the market then there is no reason why they shouldn't grow. The government has no choice but to increase their support. Although the Renewable Obligation hasn't spurred the growth of renewables as much as the government had hoped, it has been quite successful – more so than Climate Change Levy."
Opportunity may also be knocking for chp. Producers have been struggling to find contracts, but with the government encouraging chp installations, the spring review should also provide plans to facilitate the growth of this market. But chp faces challenges according to Norton: "Because of the low prices it is difficult for small generators to find contracts and get a good price. The government has a target of 20 GW of chp to be produced by 2010 but at the moment this seems very optimistic. The smaller generators don't have the same flexibility as the large companies and they do find it hard."
The price of electricity has been so low for so long in the UK, that other, more environmentally friendly and energy efficient forms of generation have been unable to get any more than a toe in the door. Now with the squeeze being put on centralised power stations, and the issue of energy efficiency becoming more important, the crisis for the electricity market could signal an opportunity for alternative solutions.
Source
Building Sustainable Design
No comments yet