Renewables Obligation: ROCs presented and Redistribution of Buy-Out Fund 2020-21
Reports, plans and updates
Publication date
Industry sector
Supply and Retail Market
Scheme name
RO
Total obligation: 119,090,744 ROCs.
The Renewables Obligation (RO) requires licensed electricity suppliers to source a proportion of the electricity they supply to UK customers from renewable sources. We set suppliers’ obligations as a number of Renewables Obligation Certificates (ROCs). The obligation levels for 2020/21, announced by the Department for Business, Energy and Industrial Strategy (BEIS) on 27 September 2019 are:
- 0.471 ROCs per MWh of electricity supplied to customers in England, Wales and Scotland
- 0.185 ROCs per MWh of electricity supplied to customers in Northern Ireland.
Using these obligation levels and multiplying by the total electricity supplied (MWh) to UK customers during this obligation period (1 April 2020 – 31 March 2021), the total obligation for 2020/21 is 119,090,744 ROCs. Split out for each obligation this is:
- 107,037,807 ROCs in England and Wales
- 10,694,439 ROCs in Scotland
- 1,358,498 ROCs in Northern Ireland.
Suppliers were able to meet their obligations for 2020/21 by 1 September 2021 (31 August for buy-out payments) by:
- Presenting ROCs to us
- Making a buy-out payment of £50.05 per ROC
- Using a combination of ROCs and a buy-out payment.
Any suppliers who did not meet their obligations in full by 1 September need to make a late payment by 31 October.
We have recently redistributed the RO buy-out fund for 2020/21. Details of the obligations, ROCs presented and total payments made for each RO scheme are shown in the Table 1 below.
Table 1
Suppliers that presented ROCs towards their obligations received buy-out fund recycle payments on 22 October 2021.
The amounts redistributed are shown in the far-right column in Table 1. We reached these values by withdrawing our and Northern Ireland Authority for Utility Regulation’s (UR) administration costs and rounding down the redistribution amounts to the nearest whole pound. Suppliers received approximately £3.87 for each ROC they presented. The proportion of the total ROCs each supplier presented, and therefore the share of buy-out payments they received, is shown in Table 2 (rounded to 2 decimal places).
There was a combined shortfall of £276,500,668.37 in the England & Wales, Scotland and Northern Ireland buy-out funds. This was due to thirty-seven suppliers not meeting their total obligations by the above deadlines. These suppliers consequently owe late payments.
The deadline for suppliers to make late payments was 31 October 2021 and we will redistribute them before 1 January 2022. This will include interest paid by the suppliers at an annualised rate of 5.1% (5% + Bank of England base rate). When we redistribute the late payments we will also confirm the final recycle value, which will include an extra amount on top of the £3.87.
For more information, contact: RECompliance@Ofgem.gov.uk.