Renewable energy 'damage' risk over tariff rule change

Construction of the Anafon hydro scheme continues with a switch-on date set for December

Investment in community-based renewable energy schemes could be at risk because of uncertainty over the returns, the natural resources minister has claimed.

Carl Sargeant said UK government plans to change the arrangements for selling power to the National Grid would "undermine investor confidence".

He said it would threaten schemes like the one he was visiting in Gwynedd.

The Department of Energy and Climate Change said support had to be balanced with protection for bill payers.

Mr Sargeant was visiting the £1.25m Anafon hydro-electric project being built at Abergwyngregyn, Gwynedd, on Tuesday.

He said he and his Scottish counterpart Fergus Ewing had written to the department (DECC) urging support for renewable energy.

Carl Sargeant (right) fears community power schemes may fail to win backing from investors

The Welsh and Scottish ministers claim proposals to change the feed-in tariff accreditation would leave project developers not knowing what rate they would be paid.

"We both see that the future direction for energy is one of local generation and supply, based on renewable sources, and smart storage and local grid management, with significant local benefit," said Mr Sargeant.

"The current proposals will significantly damage the prospects for this future if the local ownership and benefits of projects are not considered within the support regime."

The Anafon Hydro Scheme is due to be switched on in December, generating enough power to supply at least 200 homes.

The DECC said it would look at how it supported community energy projects as part of a wider review of feed-in tariffs.

A spokesperson said: "Our priority is to keep bills as low as possible for hardworking families and businesses while reducing our emissions.

"The amount of renewable energy projects being built means we are on track to meet our ambitions for 2020 and we have to balance that with the need to protect bill payers."