May 27

Meeting the challenges set out in the renewable energy law while cutting costs


The UK government looks to establish a low-carbon economy and reduce their dependence on fossil fuel imports by setting ambitious national goals.

For example, the government announced that it plans to cut greenhouse emissions by 78% by 2035, compared to 1990 levels, while achieving a 100% reduction in greenhouse emissions compared to 2050.

However, accomplishing these goals requires an expansion of the renewable energy law through complex legal frameworks, which has made compliance a major challenge.  

Regulatory laws around renewable energy sources are always changing, discouraging most firms from investing in long-term projects because they can’t be assured that they will get support over the long run. For example, onshore wind projects had government subsidies until 2016 before being revived by 2020.

If organisations are to meet the requirements in energy regulation law, then they need to account for these challenges and take steps to address them.

Accounting for the major challenges in renewable energy law and how to meet them? 

In the UK, energy law is an expansive piece of legislation covering multiple regulatory frameworks, institutional bodies, and pre-requisites. Hence, organisations need to be aware of the different dimensions of compliance. 

Understanding how the legislative framework operates 

Meeting the requirements set out in renewable energy laws requires organisations to know legislative frameworks that define the production and distribution of renewable energy.

Knowing about the critical legislative ruling and its requirements can optimise energy compliance and reduce costs. The Energy Act 2016 is the principal legislation related to renewables and is key to establishing a legal framework for low-carbon electricity generation. 

However, when it comes to the sale and distribution of alternative energy, the Energy Act secedes the Electricity Act and the Utilities Act, which are responsible for governing electricity distribution.

Energy producers would have to be keen on the requirements set out in the Energy Act, such as the provision of renewable obligation certificates and the conditions that allow the Secretary of State to set a decarbonisation target range through legalisation.

To meet regulatory requirements while keeping costs under control, organisations should consider leveraging RegTech solutions. These automated platforms empower regulators with the ability to scan large volumes of regulatory content and convert it into scannable files that can be read by machine-learning algorithms, making it easier to isolate specific sections of a relevant act and highlight critical requirements.

Obtaining necessary permits on time

In the future, we can expect a larger push for expanding energy capacity through additional infrastructure projects. However, expanding capacity requires construction projects that require specific permits and consent.

This can be a source of confusion because large scale infrastructure projects fall under a different jurisdiction from the renewable energy act. 

Large scale projects generating more than 50MW in energy capacity fall under the Planning Act 2008, meaning that infrastructure projects require specific permits from the Planning Inspectorate, while smaller utility projects generating between 100MW and 1MW fall under Planning Act or the Town and Country Planning Act (TCPA).

Procedures are key for obtaining these permits and if utility firms are to pass scrutiny from regulators and obtain the necessary permits, they must prove that their processes meet relevant health, safety and industry codes. Hence, acquiring these consents and permits means organisations need to pay attention to their compliance requirements because providing evidence makes it easier to obtain permits when necessary. 

This is where RegTech solutions become integral to the compliance process. The platform has the processing power to track internal operations with automated compliance mapping to track how internal procedures correlate to compliance requirements while saving time and cutting compliance costs.

Furthermore, the solution can streamline the creation of detailed compliance reports quickly, detailing the company’s regulatory procedures and making it easier to obtain the necessary permits within a reasonable timeframe.

Keeping up with compliance updates, new legislation, and developments

Due to the recent exogenous events, the UK government has been pushing heavily for renewable energy sources, which meant significant compliance updates published through several reports. For example, the UK government published a Ten Point Plan and Energy White Paper in 2020.

Given the ambitious targets set by the government, we could expect even more regulatory updates that could have implications on company infrastructure, internal procedures, and reporting requirements. 

With energy regulation evolving, organisations need to find a way to account for the latest updates and incorporate them into internal procedures. Hence, why a reg alerts solution is integral to this process, for it can help organisations keep up with the latest updates.  

Meeting energy compliance requirements while reducing compliance costs

In 2020, renewable energy made up 42.9% of the UK’s electricity generation, breaking all previous records. The government will look to build on this success with further amendments to energy regulation and compliance management. 

With ambitious regulatory updates expected, organisations need to reconsider their approach to compliance by modernising their approach to regulation and compliance management through RegTech platforms because such platforms can automate the process and turn it into a more responsive, efficient compliance procedure.


Energy Law Compliance, Renewable Energy Law

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