House of Lords defies Government in RO closure vote

The House of Lords on Wednesday evening voted in favour of scrapping the government’s plans to close its Renewables Obligation (RO) scheme a year early, effectively blocking its progress in becoming law.

The peers defied convention by opposing a ruling party’s election manifesto pledge, voting in support of Labour’s amendment to the Energy Bill which will prevent the government from shutting the support scheme sooner than planned.

For the renewables industry the move buoys hope that the government’s RO closure might be softened in order to pass through as law, but increases uncertainty for a sector which has been dogged by political upheaval in recent years.

Renewable UK’s director of policy Gordon Edge said following the vote that although the delay increases uncertainty, it sends a clear message to Government that shutting onshore wind support prematurely is “a mistake”.

Just weeks after the general election energy secretary Amber Rudd fulfilled the Conservative Party pledge to halt the spread of onshore wind by closing the RO scheme to onshore wind projects, saying that this would protect customers from high bills.

The government originally offered a grace period to those projects with planning permission, a grid connection and land rights. This, the government estimated, would allow 2.9GW of capacity to move ahead. But two weeks ago the government offered an extra nine months to those projects which have struggled to secure financing in order to achieve the same total.

“While we are concerned about the possibility for delay that the vote causes, we hope last night’s debate gives the government pause for thought around some of the finer details of grace period eligibility,” Edge said.

“What renewable energy developers urgently need from the Energy Bill is clarity, to minimise the impact of the changes on investor confidence,” he added.