Charges for Small Hydro improve but the system as a whole remains flawed, with major concerns outstanding.
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The best deal SEPA willing to offer
After two consultations and 5 years of negotiation, the hydro sector may have got the best deal SEPA was willing to offer. But it is clear that negotiations have fallen short of their goal: to establish fair, transparent and justifiable charges.
SEPA listened to industry concerns and acknowledged problems. The charges now being implemented represent, for most sub-2MW operators, a significant improvement from the previous scheme.
It is more consistent and easier to understand. But major concerns remain.
Most problematic is that big schemes (over 5MW) which use 87% of the water abstracted by all hydropower schemes in Scotland, will pay only 73% of the overall charges being levied by SEPA.
The British Hydropower Association and Alba Energy believe this remains unjustifiable and must be addressed.
Concerns shared by both the BHA and Alba are:
- Charges do not relate directly to SEPA costs;
- Charges do not reflect value in relation to services provided by SEPA;
- The categories of environmental impact used by SEPA are questionable;
- Schemes between 2MW-5MW have seen an unjustified 28% increase in charges;
- Small hydro already covers the environmental cost of construction with controlled water activities (CAR) licences;
- Data that SEPA holds on individual schemes is often inaccurate
There is currently no right of appeal to individual charges or means of questioning whether SEPA has correctly classified the environmental impact of a scheme. The BHA and Alba will continue to seek to address all of these issues with SEPA.
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