04 October 2001 | Liam O'Brien
Renewable energy supplies are under threat from the New Electricity Trading Arrangements (Neta), key energy buyers warned this week.
Since Neta's introduction in March, bills have come down by between 20 and 25 per cent, but buyers claim it has also begun to choke off renewable sources.
Because Neta ties generation precisely to customers' contracted requirements, electricity supply companies have preferred predictable sources of energy to less consistent methods, such as wind farms and combined heat and power (CHP) units.
Under the previous system, all power went into a central pool. But companies running CHP units and wind-farm operators have been left with unsold power.
David Kwiatek, group energy buyer for the Eastern Shires Purchasing Organisation, said: "It has almost got to the stage where renewable generators are having to pay suppliers to take production off them."
Ian Dobson, chairman of the CIPS energy committee, said: "Companies have built CHP plants that generate more than they need and find they can't sell the surplus."
CHP generators hit by Neta include British Sugar and Leicester City Council. Affected wind-farm operators include Loughborough's Beacon Energy.
Ian McKay, energy officer for Leicester City Council, said it had always been able to sell on its surplus before Neta, when PowerGen cancelled the deal.
Power regulator Ofgem said it had no plans to change Neta.