DECC comes under fire from Lords scrutiny committee

  • Houses of Parl

    The decision to close the RO a year early will now be debated in the House of Lords after passing through both SI scrutiny committees.

The government’s decision to close the Renewables Obligation (RO) to small solar PV projects has faced further scrutiny from a policy watchdog as it heads towards a debate in the House of Lords.

The Secondary Legislation Scrutiny Committee (SLSC) examines the policy content of any statutory instruments (SIs) laid before the upper house and reports on any measures deemed to be either “interesting or flawed”.

In its 24th report to the House, the committee claims the Department of Energy and Climate Change (DECC) failed to indicate the level of opposition to the early closure of the RO, scheduled for 31 March 2016, as well as any real indications of support for the changes.

In the Explanatory Memorandum (EM) handed to the committee alongside the Order to close the RO, DECC summarises the responses to its consultation on the decision in a single paragraph, stating: “A majority of respondents was opposed to the small solar PV closure but believed that if implemented the grace periods should be consistent with those provided for the large solar PV closure”

SLSC notes that this does not provide as much information as DECC’s consultation response, which states that of the 94 responses received, only six agreed with the early closure for systems below or equal to 5MW in contrast to 63 that disagreed.

The report also noted that a number of respondents had questioned the rationale of the proposals as no evidence was provided of the overspend on the Levy Control Framework (LCF) DECC used to justify the decision.

SLSC concluded to the House of Lords: “The account given in paragraph 8.1 of the EM fails both to indicate the level of opposition to, and paucity of support for, the proposed changes and to acknowledge the concerns expressed by large numbers of respondents about the methodology used by the Department to justify its proposals.”

“We draw this Order to the special attention of the House on the ground that the explanatory material laid in support provides insufficient information to gain a clear understanding about the instrument’s policy objective and intended implementation.

The report also criticised DECC’s omission of opposition to its forecasts for solar deployment, after half of the consultation responses disagreed with and questioned the estimates of 800MW to 2GW in both 2015-16 and 2016-17 of new projects of 5MW and below.

In both the summary and the impact assessment laid with the Order, DECC claims “no information was received during the consultation that challenged our assessment of future deployment”.

SIs are scrutinised by both SLSC and the Joint Committee on Statutory Instruments (JCSI) before they can be debated by the Lords. The JCSI examined the legal drafting of the Order and passed it without comment.

Now that the legislation has passed through both committees, a debate could be scheduled in the coming weeks. A spokesperson told SSP the order is waiting for a date to be set for debate and while the SLSC does not have the power to stop an SI, she added the committee does have “a good success rate”.

The judgement has been welcomed by the Solar Trade Association.

Sonia Dunlop, spokesperson for the STA, added: “We believe the committee is right to be raising concerns about this order, and we are glad to see at last some official parliamentary scrutiny of the decision to shut solar PV out of the Renewables Obligation. It is now for the members of the House of Lords to decide what to do next.”

The latest judgement will continue to build pressure on DECC over its handling of the RO scheme, which has already resulted in an ongoing court case between the government and Solarcentury, Lark Energy and a number of others.

In response to the comments made by SLSC, a DECC spokesperson said: "We consulted with a wide range of stakeholders, whose views were reflected in depth in our response to the consultation. All of our documentation adhered to existing guidelines.”

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