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Renewables Obligation (United Kingdom)

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The Renewables Obligation ( RO ) was designed to encourage generation of electricity from eligible renewable sources in the United Kingdom . It was introduced in April 2002, both in England and Wales and in Scotland albeit in a slightly different form: the Renewables Obligation (Scotland). The RO was later introduced in Northern Ireland in April 2005. In all cases, replacing the Non-Fossil Fuel Obligation which operated from 1990.

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69-518: The RO placed an obligation on licensed electricity suppliers in the United Kingdom to source an increasing proportion of electricity from renewable sources, similar to a renewable portfolio standard . In 2010/11 it was 11.1% (4.0% in Northern Ireland). This figure was initially set at 3% for the period 2002/03 and under current political commitments will rise to 15.4% (6.3% in Northern Ireland) by

138-601: A permanent secretary , two law officers – the Lord Advocate and the Solicitor General for Scotland – who serve as the chief legal advisers to the government, and the chief of staff to the first minister , as well as several other government officials, personal secretaries and advisers to the Scottish Government and the first minister. The head of the Scottish Government is the first minister who also serves as

207-556: A breakdown of public spending, the work of senior civil servants in the Scottish Government, including their job titles and salaries, as well as government assessment against objectives in order to highlight how well the government is doing in achieving the targets and objectives it creates through the National Performance Framework and Programme for Government. Additionally, the Freedom of Information (Scotland) Act 2002 gives

276-699: A different form (the Renewables Obligation (Scotland)) in Scotland in April 2002 and in Northern Ireland in April 2005, replacing the Non-Fossil Fuel Obligation which operated from 1990. The RO places an obligation on licensed electricity suppliers in the United Kingdom to source an increasing proportion of electricity from renewable sources, similar to a renewable portfolio standard. In 2010/11 it

345-624: A different number of Renewable Energy Credits depending on the generation technology; for example, solar generation counts for twice as much as other renewable sources in Michigan and Virginia. The Lawrence Berkeley National Laboratory claims that RPS requirements were responsible for 60% of the total increase in American renewable electricity generation since the year 2000. However, the LBNL also reports that RPSs' role has been declining in recent years from 71% of

414-599: A majority of MSPs in the Scottish Parliament, where it will then be put to the Monarch to receive royal assent. Once royal assent has been given by the Monarch, the bill becomes a law of the Scottish Parliament and becomes embedded in Scots law. Once a bill is successful in becoming law, the Scottish Government has the responsibility to ensure subordinate legislation, which often comes in the form of Scottish statutory instruments,

483-508: A payment is made into the buy-out fund. The buy-out price suppliers pay is a fixed price per MWh shortfall and is adjusted in line with the Retail Prices Index each year. The proceeds of the buy-out fund are paid back to suppliers in proportion to how many ROCs they have presented. For example, if they were to submit 5% of the total number of ROCs submitted they would receive 5% of the total funds that defaulting supply companies pay into

552-592: A proposal by the Parliament. The Scottish Parliament can legislate on any matter that is not reserved to the Parliament of the United Kingdom . Ministers are appointed by the first minister with the approval of the Scottish Parliament and the monarch from among the members of the Parliament. The Scotland Act 1998 makes provision for ministers and junior ministers, referred to by the current administration as Cabinet secretaries and ministers, in addition to two law officers :

621-401: A specified fraction of their electricity from renewable energy sources. Certified renewable energy generators earn certificates for every unit of electricity they produce and can sell these along with their electricity to supply companies. Supply companies then pass the certificates to some form of regulatory body to demonstrate their compliance with their regulatory obligations. RPS can rely on

690-497: Is 11.1% (4.0% in Northern Ireland). This figure was initially set at 3% for the period 2002/03 and under current political commitments rose to 15.4% (6.3% in Northern Ireland) by the period 2015/16 and then it runs until 2037 (2033 in Northern Ireland). The extension of the scheme from 2027 to 2037 was declared on 1 April 2010 and is detailed in the National Renewable Energy Action Plan . Since its introduction

759-506: Is a regulation that requires the increased production of energy from renewable energy sources , such as wind , solar , biomass , and geothermal . Other common names for the same concept include Renewable Electricity Standard ( RES ) at the United States federal level and Renewables Obligation in the UK . The RPS mechanism places an obligation on electricity supply companies to produce

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828-647: Is anticipated the CfDs will start) and 2017 to choose between CfDs and ROCs. After that date, the government intends to close the Renewables Obligation to new generation and ‘vintage’ existing ROCs, meaning that levels and length of support for existing participants in the Renewables Obligation will be maintained. However, the government subsequently announced that it would bring forward the deadline for Renewables Obligation accreditation for large scale (>5MW) solar photovoltaic power projects, to 1 April 2015. The government further announced on 18 June 2015 that it intended to close

897-497: Is directly accountable to the Scottish Parliament for their actions and the actions of the wider government and cabinet. The office is held by John Swinney of the Scottish National Party since 7 May 2024. The first minister is supported by the deputy first minister who deputises for the first minister during periods of absence, such as when he is attending overseas visits and international engagements, and may act on

966-564: Is given to the Scottish Government. The Lord Advocate serves as the ministerial head of the Crown Office and Procurator Fiscal Service , and as such, is the chief public prosecutor for Scotland with all prosecutions on indictment being conducted by the Crown Office and Procurator Fiscal Service in the Lord Advocate's name on behalf of the Monarch. The Lord Advocate serves as the head of

1035-565: Is implemented accordingly so that the new law begins to work and that any additional measures and features can be added in order to make the law work and ensure its effective implementation and operation. The Scottish Government publishes statistics based on the majority of public life in Scotland, including, but not limited to, education, the economy, healthcare, population, death, marriages and births, as well as living standards. The government uses such statistics in order to evaluate its work against

1104-785: Is issued annually detailing the precise level of the obligation for the coming year-long period of obligation and the level of the buy-out price. The Renewables Obligation (England and Wales) was introduced by the Department of Trade and Industry , the Renewables Obligation (Scotland) was introduced by the Scottish Executives and the Northern Ireland Renewables Obligation was introduced by the Department of Enterprise Trade and Investment (DETINI). The Orders were subject to review in 2005/06 and new Orders came into effect on 1 April 2006. The relevant pieces of legislation for

1173-418: Is less renewable production than the obligation, the price of ROCs would increase above the buy-out price, as purchasers anticipate later payments from the buy-out fund on each ROC. Obligation periods run for one year, beginning on 1 April and running to 31 March. Supply companies have until the 31 August following the period to submit sufficient ROCs to cover their obligation, or to submit sufficient payment to

1242-634: Is one of the Law Officers of the Crown , and the deputy of the Lord Advocate, whose duty is to advise the Scottish Government on Scots law. They are also responsible for the Crown Office and Procurator Fiscal Service which together constitute the Criminal Prosecution Service in Scotland . Together with the Lord Advocate, the Solicitor General for Scotland is one of the senior legal advisors to

1311-653: Is supported by the Cabinet Secretariat, based at St Andrew's House . While the Scottish Parliament is in session, Cabinet meets weekly. Normally meetings are held on Tuesday afternoons in Bute House , the official residence of the First Minister . Members of the Scottish Cabinet receive blue despatch boxes for their use while in office. There are currently two sub-committees of cabinet: The Lord Advocate

1380-462: Is the executive arm of the devolved government of Scotland . It was formed in 1999 as the Scottish Executive following the 1997 referendum on Scottish devolution . Its areas for responsibility of decision making and domestic policy in the country include the economy , education , healthcare , justice and the legal system , rural affairs, housing, the crown estate , the environment,

1449-495: Is the principal legal adviser for both the Scottish Government and the Crown in Scotland on civil and criminal matters that fall within the devolved powers of the Scottish Parliament . The Lord Advocate provides legal advice to the government on its responsibilities, policies, legislation and the legal implications of any proposals brought forward by the government. The Lord Advocate is responsible for all legal advice which

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1518-544: The Northern Ireland Authority for Energy Regulation (NIAER). The following sources of electricity are eligible for ROCs (although the scheme is closed to new entrants): Co-firing of biomass is also eligible. Not all technologies which are eligible will actually be supported due to cost. Some renewable sources of electricity are not eligible for ROCs (e.g. larger hydroelectric schemes which were in operation before April 2002). The Renewables Obligation represents

1587-517: The Royal Arms with the Flag of Scotland . The Scottish Government is separate from the Scottish Parliament , with the parliament being made of 129 Members of the Scottish Parliament elected by the electorate of Scotland during Scottish Parliamentary elections. The Scottish Parliament acts as the law making body for devolved matters which fall under the responsibility of the Scottish Government. The work of

1656-548: The Scottish Liberal Democrats . During this period, ministerial appointees were divided into ministers and deputy ministers. The Labour-Liberal Democrat coalition continued under subsequent First Ministers Henry McLeish and Jack McConnell . Following the 2007 Scottish Parliament election , Alex Salmond headed a Scottish National Party administration until his resignation in 2014 and the appointment of his former Deputy First Minister Nicola Sturgeon . Since 2007,

1725-590: The United Kingdom , Italy , Poland , Sweden , Belgium , and Chile , as well as in 29 of 50 U.S. states , and the District of Columbia . Renewable Energy (Electricity) Act 2000 (Cth) China adopted a renewable energy target in 2006 and modified it in 2009 to the following targets: The European Union passed the Directive on Electricity Production from Renewable Energy Sources in 2001 and expanded it in 2007 to

1794-529: The keeper of the Great Seal whilst in office as first minister. The first minister chairs the Scottish Cabinet and is primarily responsible for the formulation, development and presentation of Scottish Government policy. Additional functions of the first minister include promoting and representing Scotland in an official capacity, at home and abroad. In their capacity as Keeper of the Great Seal of Scotland,

1863-700: The lord advocate and the solicitor general for Scotland . Collectively the Scottish Ministers and the Civil Service staff that support the Scottish Government are formally referred to as the Scottish Administration. In 1885, many domestic policy functions relating to Scotland were brought into the responsibility of the Scottish Office , a department of the Government of the United Kingdom which

1932-405: The Government to steer industry towards investment in less well developed forms of renewable energy to enable them to contribute to meeting the long-term targets, rather than concentrating investment in technologies that are economically favourable in the short-term. The Government has reviewed the banding levels for appropriate incentives for the period 2013–2017. These bands include a reduction in

2001-611: The Promotion of New Energy Usage, 118 million KWh was targeted in 2012 (METI). The Republic of Korea adopted the Act on the Promotion of the Development, Use, and Diffusion of New and Renewable Energy since 2012. The Renewables Obligation (RO) is designed to encourage generation of electricity from eligible renewable sources in the United Kingdom . It was introduced in England and Wales and in

2070-634: The RO has more than tripled the level of eligible renewable electricity generation (from 1.8% of total UK supply to 7.0% in 2010 ). The Public Utility Regulatory Policies Act is a law, passed in 1978 by the United States Congress as part of the National Energy Act . It was meant to promote greater use of renewable energy, mostly through feed-in tariffs , but contains little language declaring explicit renewable energy objectives or quotas. In 2009,

2139-563: The ROC Register and so are electronic certificates. Normally, a renewable generator will transfer the related ROCs through Ofgem's electronic registry when it sells power to an electricity supplier. The Utilities Act 2000 gives the Secretary of State the power to require electricity suppliers to supply a certain proportion of their total sales in the United Kingdom from electricity generated from renewable sources. A Renewables Obligation Order

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2208-426: The Renewables Obligation in this way, and scheduling regular future reviews, the Government recognised that the market would not deliver the mix of renewable energy generation required to meet the targets if the incentives remained technology-neutral. It was therefore necessary for the Government to perform a continuing strategic role and retain the capability to intervene if necessary. The introduction of banding allowed

2277-422: The Renewables Obligation to be replaced, claiming that the scheme is a 'very costly way' of supporting renewable electricity generation. In particular they are concerned that electricity customers pay for renewables projects even if they are not built due to problems obtaining planning permission , and the failure of the Renewables Obligation to link financial support for renewables to either the electricity price or

2346-531: The Renewables Obligation to new onshore wind power projects on 1 April 2016 (bringing the deadline forward by one year). In addition to the introduction of feed-in tariffs , the UK Government's proposed electricity market reform included two further initiatives to encourage the decarbonisation of electricity generation : a Carbon Price Floor and an Emissions Performance Standard . Renewable portfolio standard A renewable portfolio standard ( RPS )

2415-518: The Scottish Executive has used the name Scottish Government. The change of name was later recognised in United Kingdom legislation by the Scotland Act 2012 . In 2001, former First Minister Henry McLeish had proposed such a change, but experienced some opposition. At the same time that the Scottish Government began to use its new name, a new emblem was adopted. It replaced the use of a version of

2484-441: The Scottish Government, including proposed legislation, policies and activities, is scrutinised by parliament through a variety of different measures such as parliamentary debates, parliament committees and parliamentary questions to the appropriate Cabinet Secretary or government minister. The Scottish Government produces a National Performance Framework which sets out the government's priorities, objectives and overall vision for

2553-459: The UK Government's main policy measure for stimulating the growth of electricity generation from renewable sources. The Government envisages that 30% of electricity demand will need to be generated by renewable sources in order for the UK to meet a legally binding EU target of obtaining 15% of energy from renewable sources by 2020. The Renewables Obligation is a market-based mechanism designed to incentivise

2622-531: The UK electricity market which saw feed-in tariffs with contracts for difference (CfD) replace the Renewables Obligation as the main renewable generation support mechanism. Unlike ROCs, CfDs will also be available to generators of nuclear electricity . Other than with respect to large scale (>5MW) solar photovoltaic power projects and onshore wind power projects, the Renewables Obligation remained open to new generation until 31 March 2017, allowing new renewable generation that comes online between 2014 (when it

2691-570: The US Congress considered Federal level RPS requirements. The American Clean Energy and Security Act reported out of committee in July by the Senate Committee on Energy & Natural Resources includes a Renewable Electricity Standard that called for 3% of U.S. electrical generation to come from non-hydro renewables by 2013, but the full Senate did not pass the bill. Different state RPS programs issue

2760-482: The United Kingdom and supplied to customers in the United Kingdom by a licensed supplier. ROCs are issued by Ofgem to accredited renewable generators (or in the case of generating stations subject to a NFFO ( non-fossil fuels obligation ), Scottish Renewables Obligation or Northern Ireland NFFO contract, to the nominated electricity supplier). It is worth noting that the Scottish Renewables Obligation

2829-529: The adoption of RPS mechanisms claim that market implementation will result in competition, efficiency, and innovation that will deliver renewable energy at the lowest possible cost, allowing renewable energy to compete with cheaper fossil fuel energy sources. Since 2013, the Levelized cost of electricity from Wind energy dropped below that of all fossil fuels, followed in 2015 by Solar energy . RPS-type mechanisms have been adopted in several countries, including

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2898-661: The agreement of the Scottish Parliament. They need not be members of the Scottish Parliament. In addition to the Scottish Ministers, the Scottish Government is supported by a number of officials drawn from the UK Civil Service . They are collectively referred to as the Scottish Administration in the Scotland Act 1998. According to 2012 reports, there are 16,000 civil servants working in core Scottish Government directorates and agencies. A total of eight director–generals head Scotland's civil service department. Each director–general

2967-921: The annual American renewables builds in the year 2013 to 46% just two years later, in 2015. Scottish Executive Charles III William , Duke of Rothesay Swinney government The Rt Hon John Swinney MSP The Rt Hon John Swinney MSP Kate Forbes MSP Sixth session Alison Johnstone MSP Angela Constance MSP Dorothy Bain KC The Rt Hon Lord Carloway KC PC United Kingdom Parliament elections European Parliament elections Local elections Referendums Starmer ministry The Rt Hon Keir Starmer MP The Rt Hon Ian Murray MP The Scottish Government ( Scottish Gaelic : Riaghaltas na h-Alba , pronounced [ˈrˠiə.əl̪ˠt̪əs nə ˈhal̪ˠapə] )

3036-478: The buy-out fund to cover the shortfall. The cost of ROCs is effectively paid by electricity consumers of supply companies that fail to present sufficient ROCs, whilst reducing the cost to consumers of supply companies who submit large numbers of ROCs, assuming that all costs and savings are passed on to consumers. (1 April to 31 March) (£/MWh) per Unit (p/kWh) Sources: A ROC is the green certificate issued for eligible renewable electricity generated within

3105-443: The buy-out fund. ROCs are intended to create a market, and be traded at market prices that differ from the official buy-out price. If there is an excess of renewable production, beyond the supplier obligation, the price of ROCs would fall below the buy-out price. The price of ROCs could approach zero if renewable and non-renewable generation costs became similar, when there would be little or no subsidy of renewable generation. If there

3174-505: The country following election. It serves as a means for the Scottish Government to highlight national priorities and provides an opportunity for the government to evaluate its progress towards achieving the objectives as set out in the National Performance Framework. Similarly, the Programme for Government is published annually by the incumbent Scottish Government, and it highlights the governments policies, proposed actions and legislation that

3243-493: The country. Each of the National Outcomes is measured by a number of indicators and associated data sets. The majority of bills proposed to the Scottish Parliament come from the Scottish Government. The process for introducing bills to the parliament for consideration and debate commences with the government publishing and formulating policy. A bill will only become law in Scotland under Scots law once it has been approved by

3312-431: The data to gauge how successful, or unsuccessful, government policy is and whether it is having the desired impact. In order to ensure accountability, the Scottish Government publishes information for public consumption in order to ensure the work of the Scottish Government is accessible and transparent for the public. It commits itself to publishing information in areas relating to the spending of public money and creating

3381-402: The fire service , equal opportunities, the transportation network , and tax , amongst others. The Scottish Government consists of the Scottish Ministers, which is used to describe their collective legal functions. The Scottish Government is accountable to the Scottish Parliament , which was also created by the Scotland Act 1998 with the first minister appointed by the monarch following

3450-515: The first minister is one of only a few individuals permitted to fly the Royal Banner of the Royal Arms of Scotland . The first minister is nominated by the Scottish Parliament by fellow MSPs , and is formally appointed by the monarch . The first minister appoints members of the Scottish Cabinet and junior ministers of the Scottish Government. As head of the Scottish Government, the first minister

3519-468: The first ministers behalf during First Minister's Questions in the Scottish Parliament . Whilst serving as deputy first minister, the office holder holds another cabinet position. Currently, Kate Forbes , the Cabinet Secretary for Economy and Gaelic , serves as the deputy first minister. The Scottish Cabinet collectively takes responsibility for policy coordination within the Scottish Government. It

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3588-503: The following EU-wide targets (although member states are free to pass more aggressive targets): The German Renewable Energy Act , since its adoption in 2000, is producing strong growth in renewable power capacity by encouraging private investors through guaranteed Feed-in tariffs . Germany adopted targets more aggressive than the EU mandated targets in September 2010: Based on the 1997 Act on

3657-460: The generation of electricity from renewable energy sources over more traditional alternatives at a reasonable cost. When it was first introduced in 2002, each form of renewable energy technology received the same level of support, namely one ROC/MWh of electricity generated. This was a conscious decision as the Government was keen to promote a market-led approach, emphasising competition between technologies to minimise cost, and did not want to distort

3726-402: The government in Scotland. Whilst the Solicitor General for Scotland supports the Lord Advocate in their functions, the Solicitor General may also exercise their statutory and common law powers when necessary. The incumbent Solicitor General for Scotland is Ruth Charteris KC . The Scottish law officers are appointed by the monarch on the recommendation of the incumbent first minister, with

3795-438: The government will seek to implement in the forthcoming year. The Scottish Government introduced the first National Performance Framework (NPF) in 2007. This framework acts a means to measure the performance of the government in eleven national outcome areas which include health, poverty, environment and education. Additionally, it creates a pledge and commitment on the aspirations and aims that government wishes to create within

3864-459: The market by appearing to place the importance of certain technologies above others. As a result, whilst being ostensibly technology-neutral, the Renewables Obligation in its original form in fact favoured the deployment of the more established, near-market technologies such as landfill gas and onshore wind , those which were most economically efficient, over less well developed technologies that were further from commercial viability. A review of

3933-569: The marketplace to maintain the confidence of investors. The concerns of both bodies seem to be shared by the Renewable Energy Association . The Scottish Wind Assessment Project has criticised the scheme for rewarding reductions in renewable electricity output: two electricity suppliers, Scottish and Southern Energy and Npower , down-rated several large hydro-power stations in order to qualify for Renewables Obligation Certificates. The UK Government proposed wide-ranging reforms to

4002-495: The original scheme. The Government announced its intention to reform the Renewables Obligation in 2006. Banding was introduced in 2009 to provide differing levels of support to groups of technologies depending upon their relative maturity, development cost and associated risk. Whilst increasing the incentive for technologies in the early stages of development this also allowed the level of support for well established technologies to be reduced to avoid over-subsidisation. In reforming

4071-434: The performance of the Renewables Obligation was announced in 2003. Modelling of future deployment scenarios indicated that targets would not be met with current levels of support due to constraints on the availability and deployment of the most established technologies. A significant contribution would therefore be required from less mature technologies which lacked sufficient incentive to develop into feasible alternatives under

4140-595: The period 2015/16 and then it runs until 2037 (2033 in Northern Ireland). An extension of the scheme from 2027 to 2037 was declared on 1 April 2010 and is detailed in the National Renewable Energy Action Plan . The RO closed to new generation in March 2017, and was replaced by the Contracts for Difference scheme. Suppliers meet their obligations by presenting Renewable Obligation Certificates (ROCs) to Ofgem . Where suppliers do not have sufficient ROCs to cover their obligation,

4209-564: The period April 2006 – March 2007 are: All pieces of legislation are published on the National Archives legislation site. Ofgem is the Office of Gas and Electricity Markets in Great Britain. The Orders detail Ofgem's powers and functions to administer the Renewables Obligation. These functions include: Ofgem also administers the Northern Ireland Renewables Obligation (NIRO) on behalf of

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4278-542: The price of renewables in the European Union Emissions Trading Scheme . The British Wind Energy Association , whose members are major beneficiaries of the existing scheme, claims that Ofgem is partly responsible for the costs because it has failed to prioritise work on the National Grid which would allow more renewable capacity to be connected. They also stressed the need to maintain stability in

4347-570: The private market for its implementation. In jurisdictions such as California, minimum RPS requirements are legislated. California Senate Bill 350 passed in October 2015 requires retail sellers and publicly owned utilities to procure 50 percent of their electricity from eligible renewable energy resources by 2030. RPS programs tend to allow more price competition between different types of renewable energy, but can be limited in competition through eligibility and multipliers for RPS programs. Those supporting

4416-464: The public the right to ask for information relating to the Scottish Government, as well as other public sectors. The Scottish Government consists of a first minister , deputy first minister , nine cabinet secretaries and eighteen other government ministers, collectively for statutory purposes, "the Scottish Ministers ". Cabinet secretaries are senior members of the Scottish Cabinet , whilst

4485-401: The remaining government ministers are junior ministers of the government and act as a deputy to the corresponding cabinet secretary of that department, and support the duties and functions of the cabinet secretary. As junior ministers of the government, ministers do not usually attend the Scottish Cabinet; only the cabinet secretary attends. Additionally, the Scottish Government is supported by

4554-568: The systems of prosecutions in Scotland and is responsible for the investigation of all sudden, suspicious, accidental and unexplained deaths which occur within Scotland. The officeholder is regarded as one of the Great Officers of State of Scotland, with the current Lord Advocate being Dorothy Bain KC , who was nominated by first minister Nicola Sturgeon in June 2021. The Solicitor General for Scotland

4623-473: The tariff for onshore wind to 0.9 ROCs/MWh and an increase for small wave and tidal stream projects, under 30 MW, to 5 ROCs/MWh. The obligation was reviewed by government following a consultation period that finished in September 2007. The document at the centre of the consultation set out an amended form of the RO which will see different technologies earn different numbers of ROCs. This has not yet been adopted as policy. On 22 January 2007, Ofgem called for

4692-530: Was headed by a Secretary for Scotland, later the Secretary of State for Scotland . Following the 1997 referendum on devolution, many of the functions of the Secretary of State for Scotland were transferred to the Scottish Ministers, accountable to a devolved Scottish Parliament. The first Scottish Executive was formed by First Minister Donald Dewar as a coalition between the Scottish Labour Party and

4761-404: Was superseded by the Renewables Obligation (Scotland) in 2002. The default is that one ROC is issued for each megawatt-hour (MWh) of eligible renewable output. Some technologies get more, some less. For instance, offshore wind installations receive 2 ROCs per MWh; onshore wind installations receive 0.9 ROCs per MWh and sewage gas -fired plants receive half a ROC per MWh. ROCs are issued into

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