The Renewables Obligation (Scotland) (ROS) is the Scottish Executive's main policy instrument for delivering more renewable electricity generating capacity in Scotland.  The ROS creates an incentive for the development of new renewable generating capacity by requiring licensed suppliers to supply increasing proportions of renewable sourced electricity.   

The ROS was introduced into legislation as the Renewables Obligation (Scotland) Order 2002.  The ROS was amended by subsequent Orders in 2004 and 2005.  The Scottish Executive has recently consulted on the ROS (based on a commitment given in the 2003 UK Energy White paper).  The preliminary consultation paper was published in April 2005.  Following this initial statutory consultation the Executive proposed a range of amendments to the ROS and consulted on their implementation.

The statutory consultation document contained a number of detailed proposals which the Executive claimed would make it easier for renewable generators to benefit from the ROS and for electricity suppliers to comply with it.

The Executive has now closed the 2005/6 consultation and concluded its final policy positions.

The key proposal and outcomes of the review are set out below.  The revised RSO Order is set to take effect from April 2006.

Proposals Outcomes
Changes to the ROS eligibility rules in the area of mixed wastes.  
  • Making the ROS neutral to mixed waste to give generating stations additional flexibility to burn mixed wastes without losing eligibility for pure biomass fuels burned in the generation station.
No changes to the ROS at this stage (however, the Executive will consider this issue in further reviews).
  • Reducing the definition of biomass from fuel which is over 98% pure biomass to a lower figure.
The ROS will be amended to reduce the biomass threshold to 90%.
  • Widen eligibility for energy from waste using good quality Combined Heat and Power.
The ROS will be amended to confer eligibility on such stations where they reach a high (published) standard, whether those stations are existing or new, and in proportion to the biomasss element of the fuel mix.
Reducing support for lower cost technologies.

Final decisions and provisions implementing a reduction in eligibility for landfill gas will be discussed and agreed by the Executive over the coming year, with implementation in 2007.

The case for reducing support for onshore wind will be monitored going forward.

Administrative and technical issues.  
  • Pre-accreditation for ROC eligibility.
The ROS will be amended to include a pre-accreditation system for ROC eligibility.
  • Allowing generators to submit late applications for ROCs one month later than currently permitted.
The two month deadline will remain. However, Ofgem will have greater flexibility to issue ROCs under certain circumstances.
  • Annual declarations.
The ROS will be amended so that generators may submit the Article 4 (10)c declaration, which confirms that renewables energy on which ROCs are claimed has been supplied to customers in the UK, on an annual basis (rather than monthly).
  • ROCs claimed but not issued.
The ROS will be amended to avoid the position where electricity generated from hydrogen, which itself is produced from the electricity generated from renewable sources, receives ROCs twice.
  • Changing the timetable for supplier compliance.
The ROS timetable will be altered to speed up the time between the end of an obligation period and the recycling of buyout payments. This should increase the cash flow to ROC holders and decrease the risk of supplier default impacting upon the size of the buyout fund.
  • Storage.
The ROS will be amended to prevent the double counting of ROCs from storage devices.
Biomass measuring and sampling. The ROS will be amended to clarify the position regarding off-site blending and measurement of biomass fuels. It will also be amended to allow reduced sampling for established fields.
Small generators (those with a declared net capacity of less than 50 kilowatts).  
  • Removing the sale and buyback requirement for small generators.Allowing agents to act on behalf of smaller generators and amalgamate their outputs.
These proposals require changes to the primary legislation. When these have been made, the Executive intends to amend the ROS from April 2007 to remove the sale and buyback requirement and implement the agency provisions.

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