Renewables Obligation (RO) Annual Report 2022-23 - (Scheme Year 21)

The Renewables Obligation (RO) is a government scheme designed to support large-scale renewable electricity generation in Great Britain (GB), and both large-scale and smaller scale renewable electricity generation in Northern Ireland (NI). By helping to support the generation of electricity in the UK from renewable sources, the scheme is an important contributor on the country's journey to Net Zero.

This RO Annual Report presents a summary of activity on the scheme during Scheme Year 21 (SY21: 1 April 2022 to 31 March 2023).

Highlights:

Renewables Obligation Certificates (ROCs) issued and renewable generation

• We issued 108.3 millionROCs in SY21. This represents a small increase compared to the 105.1 million ROCs issued in SY20.
• ROCs were issued based on 80.3 TWh of renewable generation. This was equivalent to 31.8% of the UK electricity supply market.
• Renewable generation when including output on the Feed-in Tariffs (FIT) and Contracts for Difference (CfD) schemes rises to 108.2 TWh, equivalent to 42.8% of UK supply.

Compliance by licensed electricity suppliers

• The total obligation for SY21 was 121.8 million ROCs.
• To meet their obligations 107.7 million ROCs were presented by suppliers in SY21 (this was 88.4% of the total obligation). To make up for the shortfall in ROCs a further £748.6 million was paid by suppliers into the buy-out and late payment funds.
• Each ROC was notionally worth £59.76, which when multiplied by the 107.7 million ROCs presented results in a scheme value of approximately £6.4 billion.
• One supplier, UK Energy Incubator Hub, with two obligations equating to 1,882 ROCs, did not present ROCs or make payments sufficient to meet their obligations. This supplier ceased trading during SY21 and we are pursuing the outstanding balances through their administrators.
• Non-compliance by UK Energy Incubator Hub resulted in a shortfall of £99,520.16 (excluding interest) in the buy-out and late payment funds. This shortfall is well below the mutualisation threshold for both RO and ROS, meaning mutualisation was not triggered for the first time since Scheme Year 16 (2017-18).

Generator compliance

• As part of our work to ensure compliance with the scheme regulations, we conducted 200 audits on generating stations in the UK.
• Following a compliance investigation, we withdrew the accreditation of one station as it was unable to provide sufficient evidence showing when initial generation occurred.
• The total value of our work detecting and preventing error on the RO scheme during SY21 was around £13.5 million.

Please note: For those who wish to look at the data used in the report in more detail, a spreadsheet with this information is published alongside the report below.

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