Calls for Levy Control Framework reform grow

Calls for a reform of the government’s Levy Control Framework (LCF) are growing as the energy industry looks for clarity on the policy beyond 2020.

Speakers at the Utility Week Energy Summit raised concerns about a lack of information from government on what will happen to the levy after 2020 after which there is currently no budget set.

Earlier this year Energy UK demanded an urgent review of the framework in order to continue attracting investment.

Panel member at the event this week, Renewable Energy Association chief executive Nina Skorupska said: “Now we are starting to wonder what is going to happen beyond 2020? I’ve not heard anything new in the last year of what that energy policy is around the levy control framework.

“My members in energy from waste and advanced combustion technologies who are getting closer to getting more commercial need that stab together, the marine industry are up in arms and apoplectic and applying for grants all over the place – even in Europe, but they can forget about that now I’m guessing – and one of the most cheapest technologies that could be potentially delivering renewable energy very fast, which is coal power plant conversions to burning biomass from sustainable sources, can we get any money in there? No.”

Energy UK chief executive Lawrence Slade agreed, but said that there might be an issue around how quickly we can get the framework in place.

Centrica’s chief executive Iain Conn and EDF Energy’s Vincent De Rivaz also both argued that levies were burdening customers who could not afford them.

The LCF was established in 2011 by the Department for Energy and Climate Change and HM Treasury to control the cost of levy-funded schemes such as the Energy Company Obligation (Eco) against annual caps. In 2015 it was revealed that the government was set to overspend under the framework by £1.5 billion and that the government would make cuts to subsidies in an attempt to keep costs down.