Memorandum by Brightstar Environmental
Brightstar Environmental (Brightstar) is a subsidiary
of Energy Developments Limited (EDL), an Australian listed company,
and one of the world's largest dedicated renewable power generators.
The Company has developed a new technology known
as SWERFTM (Solid Waste Energy and Recycling Facility) to process
municipal solid waste (MSW) into energy. The SWERFTM process qualifies
within the Renewables Obligation Draft Order as a renewable energy
technology eligible for support. As a recent entrant into the
UK renewables market, and as owner and operator of an emerging
technology, Brightstar is well placed to comment on the Government's
strategy for diverse and secure sources of energy supply.
1.1 Brightstar Environmental (Brightstar)
is a subsidiary of Energy Developments Limited (EDL), an Australian
listed company, and one of the world's largest dedicated renewable
power generators. EDL has been operational in the UK since 1996
developing projects under the Non Fossil Fuel Obligation (NFFO)
1.2 Brightstar has developed a new technology
known as SWERFTM (Solid Waste Energy and Recycling Facility) to
process municipal solid waste (MSW) into energy, SWERFTM integrates
recycling with the use of proprietary pyrolysis and gasification
technologies to convert the residual organic fraction of MSW into
a clean fuel gas for direct use in spark ignition engines. The
SWERFTM process is included within the Renewables Obligation Draft
Order as a renewable energy technology eligible for support.
1.3 As a recent entrant into the UK renewables
market, and as owner and operator of an emerging, non-incineration,
energy from waste (EfW) technology, Brightstar is well placed
to comment on the Government's strategy for diverse and secure
sources of energy supply.
2. SUMMARY OF
2.1 Brightstar wishes to comment on the
contribution that renewable energy (RE) can make toward the Government's
objective for diverse and secure sources of energy supply, and
whether current policies are sufficient to allow this potential
to be delivered upon.
2.2 We consider that only through a unified
and sustained approach to renewable energy generation will the
Government be able to foster the creation of a diverse and commercially
viable renewable energy sector. While the recently announced Renewables
Obligation provides a positive step toward this, the existing
fragmentation of policy responsibilities across Government departments
may hinder the full potential of the RE sector from developing.
2.3 The division of responsibility between
the DETR and DTI for waste and renewable energy policies is causing
confusion in the market place. The formation of a Sustainable
Energy Agency will assist the Government in achieving the needed
unified approach, and facilitate it to deliver fully its targets
for sustainable development and environmental improvement.
3.1 The Government has stated its intention
to derive a minimum of 10 per cent electricity production from
certified renewable sources by 2010. Additionally, it has set
itself five key aims for its renewable energy policy. We would
draw attention to two in particular, "to help provide secure,
diverse, sustainable and competitive energy supplies," and,
"to stimulate the development of new technologies necessary
to provide the basis for continuing growth of the contribution
from renewables in the longer term."
3.2 Given the present level of development
in the sector, the Government's 10 per cent renewable electricity
generation target will be met only with the inclusion of energy
from waste projects in its calculations. While Government is undoubtedly
correct to focus greater effort and its research and development
spending on neglected sources of renewable energy generation,
such as wind power, wave power, energy cropsin doing so
it should not lose sight of the energy from waste sector in its
totality. Emerging technologies in this area can, with the correct
support, play a major role in delivering its renewable energy
4. THE ROLE
4.1 The attraction of energy from waste
is its ability to contribute toward multiple and diverse environmental
improvement targets. EfW diverts waste away from landfill, eliminates
methane emissions from landfill waste, and generates electricity
without the climate change implications of fossil fuels.
4.2 Energy from waste has been the principal
beneficiary of the Non Fossil Fuel Obligation (NFFO), a regime
that has done much to encourage private sector take-up of first
generation EfW technologymass burn incineration.
4.3 NFFO provided small renewable generators
with a secure outlet for their power through a long-term contract
at a fixed power price. The RO does not provide this same long-term
security, but does create market demand for renewable power at
a more attractive price to offset some of this financial risk.
The RO is also intended to stimulate the development of new technologies.
4.5 Whilst the Preliminary Consultation
on the RO made no distinction between types of EfW process, and
consequently excluded all EfW from support, Brightstar is pleased
to note the amendments now contained in the Renewables Obligation
4.6 In its modified form, Advanced Thermal
Conversion (ATC) technologies, including pyrolysis and gasification,
are included as eligible for support under the RO. Brightstar
considers this to be a recognition of the environmental advantages
of ATC over traditional mass burn incineration EfW. Further it
is a clear statement of the Government's intent to promote alternative
technologies and secure diversity in RE generation.
5. THE NEED
5.1 The RO Draft Order aside, Brightstar
remains concerned by the sometimes disjointed nature of the Government's
approach to renewable energy. While we do not doubt Government's
enthusiasm for the promotion of RE technology, the division of
policy responsibilities across several departments perhaps works
against the efficient delivery of its objectives for the sector.
The issue of Combined Heat and Power is a particularly stark illustration
5.2 Equally, the place of RE within the
Government's overall energy strategy is at times ill-defined.
The recent OFGEM report on NETA's impact on small generators highlighted
a tendency to discriminate against RE sources, an outcome contrary
to the Government's objectives. While we welcome the Minister
for Energy's announcement to consult on this issue, and acknowledge
the Government's endeavours to address problems as they arise,
it is suspected that the NETA effect might be attributed to a
weakness in the understanding of RE specific issues. It is hoped
that this Inquiry, and the study under way within the Performance
and Innovation Unit, will make recommendations to address this.
5.3 While in its response to the House of
Lords report on Electricity from Renewables (HL 78-1, 29 June
1999), the Government rejected the formation of a Sustainable
Energy Agency, the evident difficulties in establishing a viable
and vibrant renewables sector highlights the validity of its recommendation.
5.4 Brightstar therefore supports the House
of Lords in its view that only with the creation of such an agency
will the necessary joined-up thinking on sustainable development,
and the contribution of renewable energy, be truly realised.
6.1 Brightstar wishes to see a strong and
dynamic renewables sector from the belief that this kind of environment
is the best way of delivering on the promise that renewable energy
generation offers. If ultimately all forms of renewable energy
must demonstrate their economic viability independently in the
mass electricity generation market, the role of Government now
is to put in place the foundations on which the private sector
6.2 The Renewables Obligation is a key means
by which it proposes to do so, and its revised formulation does
now encourage increased competition within the various sectors
of RE generation. This is very much to be welcomed, but doubts
remain about the Government's overall vision for renewable energy
and coherence of its policy. A dedicated Sustainable Energy Agency
is perhaps a means of addressing this, and it is to be hoped that
the creation of such an entity will be an outcome of the current
31 October 2001