Trouble on the horizon: Securing the decommissioning of offshore renewable energy installations in UK waters. (October 2021)

• Record Type: Journal Article
• Authors: Mackie, Colin; Velenturf, Anne P.M.
• Is Part Of: Energy policy. Volume 157(2021)
• Publication Date: 2021-10
• Subjects: Financial security -- Polluter-pays principle -- Offshore renewable energy installations -- OREIs -- Offshore wind -- Energy transition; Energy policy -- Periodicals; Politique énergétique -- Périodiques; Electronic journals; 333.79
• DOI: 10.1016/j.enpol.2021.112479
• Languages: English
• ISSNs: 0301-4215

Abstract

Abstract: This article elucidates the principal causes of risk to taxpayers created by the manner in which 'security requirements' are currently deployed by regulators in relation to the decommissioning of offshore renewable energy installations (OREIs) in English, Welsh and Scottish waters. It does so to inform policy development pertaining to their more efficacious utilization. In this context, security requirements are a regulatory tool which necessitate that developers/owners evidence their ability to finance decommissioning. Their deployment within the framework that governs the decommissioning of OREIs across the UK has not previously been 'stress tested' in the literature. Four causes are identified: excessive regulatory discretion; a flawed focus on financial strength; the dangers of gradual accrual; and uncertainty in decommissioning costing. A series of high-level policy recommendations are presented, several of which may be germane to other sectors and jurisdictions, as to how security requirements may be used more efficaciously to ensure decommissioning is performed. Highlights: Identification of risk to taxpayers from security requirements for UK offshore renewable projects. Presentation of a new guiding principle for security provision. Provision of solution to ensure security can guarantee decommissioning occurs. Recommendations for better intelligence gathering around costings.