The Renewables Obligation (RO) requires licensed electricity suppliers to source a proportion of the electricity they supply to UK customers from renewable sources. We set suppliers’ obligations as a number of Renewables Obligation Certificates (ROCs). The revised obligation levels for 2019/20, announced by the Department for Business, Energy and Industrial Strategy (BEIS) on 28 September 2018 are:
- 0.484 ROCs per MWh of electricity supplied to customers in England, Wales and Scotland
- 0.19 ROCs per MWh of electricity supplied to customers in Northern Ireland
Using these obligation levels and multiplying by the total electricity supplied (MWh) to UK customers during this obligation period (1 April 2019 – 31 March 2020), the total obligation for 2019/20 is 130,183,968 ROCs. Split out for each obligation this is:
- 116,940,506 ROCs in England and Wales
- 11,782,299 ROCs in Scotland
- 1,461,163 ROCs in Northern Ireland.
Suppliers were able to meet their obligations for 2019/20 by 1 September 2020 (31 August for buy-out payments) by:
- Presenting ROCs to us
- Making a buy-out payment of £48.78 per ROC
- Using a combination of ROCs and a buy-out payment.
Any suppliers who did not meet their obligations in full by 1 September need to make a late payment by 31 October.
We have recently redistributed the Renewables Obligation (RO) buy-out fund for 2019/20. Details of the obligations and total payments for each RO scheme are shown in the Table 1 below.
Suppliers that presented ROCs towards their obligations received buy-out fund recycle payments on 16 October 2020.
The amounts to be redistributed are shown in the far-right column in Table 1. We reached these values by withdrawing our and Northern Ireland Authority for Utility Regulation’s (UR) administration costs, factoring in interest and rounding down the redistribution amounts to the nearest whole pound. Suppliers received approximately £5.02 for each ROC they presented. The proportion of the total ROCs each supplier presented, and therefore the share of buy-out payments they received, is shown in Table 2 (see here).
There was a combined shortfall of £105,555,614.21 in the England & Wales, Scotland and Northern Ireland buy-out funds. This was due to thirty-three suppliers not meeting their total obligations by the above deadlines. These suppliers consequently owe late payments.
The deadline for suppliers to make late payments was 31 October 2020 and we will redistribute them before 1 January 2021. This will include interest paid by the suppliers at an annualised rate of 5.1% (5% + Bank of England base rate) as well as interest earned on the funds while in our accounts. When we redistribute the late payments we will also confirm the final recycle value, which will include an extra amount on top of the £5.02.