EXCLUSIVE: DECC abolition prompts mixed views from UK’s renewable energy sector

The abolition of the Department of Energy and Climate Change (DECC) has prompted mixed views from the UK’s renewable energy sector.

The UK’s new Prime Minister Theresa May scrapped DECC in her Cabinet reshuffle on Thursday (14 July). DECC policy areas will now move to the new Department for Business, Energy and Industrial Strategy.

The energy portfolio will now be led by former Communities Secretary Greg Clark.

‘Judged on deeds rather than words’

Charlotte Morton, CEO of the Anaerobic Digestion Bioresources Association (ADBA), told Bioenergy Insight: “Our environment and our economy need the government’s commitment to the Climate Change Act to be unaffected by the removal of ‘Climate Change’ from the departmental name plate.

“The new ministerial team will be judged on deeds rather than words, and we welcome the appointment of Greg Clark to head the new department. With strong growth in the UK’s green gas sector over the past two years, the Secretary of State has a big opportunity to build on that by committing to continue to fund biomethane in the Renewable Heat Incentive, and to work closely with Defra to deliver support for on-farm AD and food waste collections to ensure the UK can meet its carbon budgets.

“Green gas has huge global potential, and AD can help with a range of challenges including mitigating climate change, improving sanitation and delivering sustainable farming. The new Business, Energy and Industrial Strategy department can help the UK’s leading AD industry, academia and regulators to realise these opportunities in the UK and around the world.”

‘Long-term strategic plan’

George Giles, head of environmental power and oil and gas at Siemens, added: “It is a bit too early to say how this will change things.  However we welcome the emphasis on combining these areas together and hope this delivers a long-term strategic plan that has the vision to provide us with the much needed clarity of direction for our critical infrastructure and energy requirements.  We look forward to getting actively involved to make this happen.”

‘Disconnect across Whitehall’

David Newman, managing director of UK trade association BBIA, told Bioenergy Insight: “There always has been a disconnect across Whitehall between various departments trying to handle the same issues. For example, bioeconomy includes agriculture, industry, energy, waste, innovation, research.  So theoretically less departments would mean more connecting and less cross referencing between various offices.  If this is the intention, then well done.

“One fears of course the downgrading of attention to the nexus between climate, energy, industrial development and environmental protection by reducing the voice of the climate change element in the puzzle. In this sense, it is worrying. But if one wishes to believe the government, this is not the intention.  As intentions play out through policies, we will be able to judge in a few months’ time. I hope our worst fears are not realised.”

Newman added that much will now depend on how active the government decides to be on industrial policy.

He explained: “It has been notably inactive in the last year, except to cut incentives for renewables.  Waste policy has seen no new initiatives in five years (remember former Communities Secretary Eric Pickles) whilst funding for public services declines.

“Now that EU targets will no longer bear the weight of EU penalties if they are not reached, I really fear for the waste sector.  

“There are no new private finance initiatives, councils are cutting services not adding to them (in England), gate fees are unsustainably low,  and exports to the European waste to energy plants ( 3 million tons this year) of UK refuse-derived fuels really have the Europeans laughing at us.  How can we be so dumb as to send them both energy and money?  Maybe a fall in landfill tax is on the cards? And recycling levels may be destined to decline further as secondary raw material markets stay soft.  Anaerobic digestion will need to consolidate as the double whammy of incentive cuts and low fossil fuel prices hits hard.

“We will see if the government actually cares about this lack of progress or not. My view is that the signals will not be positive, at least in the near future.”

'Could help'

HRS managing director Mark Wickham said: "So long as the abolition of DECC does not mean that there is a reduced focus on energy and climate change matters, the absorption of these responsibilities into a department focused on business and industrial strategy could help to streamline government action.

"The energy sector has consistently called for long-term planning and stability. We are encouraged by the appointment of Greg Clark to the role as Secretary of State and look forward to working with him to deliver clean, secure energy for British homes and businesses.

"We are proud to be a British success story, with domestic projects and larger scale developments exported around the world. It is our hope that the change in department structure will mean we can replicate these successes just as quickly and easily in the UK.”

Tim Knight, head of energy rractice at Political Lobbying and Media Relations, added: "The merger will have considerable ramifications for the energy industry, and it’s important organisations keep a close eye on these developments.

"There has been a pervasive sense that the Treasury was pulling the strings at DECC in recent years, but this new combined department may be afforded a greater degree of autonomy.

"Bringing business and energy together in the same department could also help to bring a more coordinated approach to policymaking, yet there is a concurrent risk that energy may fall down the Government’s list of priorities.

"From a communications perspective, it is therefore important that energy businesses engage with the right people in government at the earliest opportunity to ensure they are not left behind.

"Furthermore, with climate change dropped from the name of the department, those involved in renewable energy will watch the new Secretary of State’s first moves with interest to see the vigour with which he pursues the ongoing commitment to the UK’s carbon reduction targets.”  

This story was written by Liz Gyekye, editor of Bioenergy Insight.