The Renewables Obligation (RO) is the main support system for any renewable electricity projects set up in the UK. Smaller scale generation of electricity is usually supported by the better-known Feed-in Tariffs (FITs).
The RO was brought into being in 2002 in England and Wales, with Scotland and Ireland following on in 2005. It puts an obligation upon UK electricity suppliers to generate an ever-increasing amount of its electricity using renewable sources.
To find out how the obligation level is determined each year, see the Department of Energy and Climate Change website.
Renewables Obligation Certificates (ROCs) are green certificates handed to operators of officially accredited renewable generating stations for the eligible renewable electricity they generate. Operators are permitted to trade their ROCs with other parties, and the certificates are ultimately used by suppliers to show that they have met their obligation.
Where suppliers do not show a sufficient number of ROCs to reach their obligation, they must pay a matching amount into a buy-out fund. The administration cost of the scheme is cancelled out by the fund and the remainder is distributed back to suppliers in proportion to the number of ROCs they produced in respect of their own obligation.
To find out more about the Renewables Obligation, call Ofgem on 020 7901 7310 or email firstname.lastname@example.org
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