The Green Gas Support Scheme and the Green Gas Levy are two terms that lots of people have likely heard but very few understand what they mean.
Even fewer know exactly who stands to benefit.
Fewer yet know by how much and how to get started…
Keep reading to find out what they are and why they’re so important to you.
The Green Gas Support Scheme (GGSS)
The Green Gas Support Scheme (GGSS) is a government environmental program that provides financial incentives for the construction of new anaerobic digestion biomethane plants in order to increase the proportion of green gas in the gas grid.
The scheme is open to applicants in England, Scotland, and Wales for a four-year period beginning on November 30, 2021. All of the registered participants will be paid quarterly over a 15-year period, with payments based on the amount of eligible biomethane injected into the gas grid by a participant.
GGSS Further Details
The Green Gas Support Scheme (GGSS) provides tariff assistance to plants that produce biomethane through anaerobic digestion and inject it into the gas grid. Tariffs are calculated to compensate plants for the cost of constructing new infrastructure to produce biomethane as well as ongoing operating costs.
The Green Gas Levy, which is levied on all licensed fossil fuel gas suppliers, funds this scheme. The scheme is essentially modelled on the Non-Domestic Renewable Heat Incentive (RHI) Scheme, which closed to new applicants on March 31, 2021.
The GGSS will opened on November 30, 2021 and will be accepting applications for the next four years.
How To Apply
You can apply through Ofgem’s Green Gas Support Scheme website. On the Ofgem website, you can learn more about the scheme and read the scheme guidance. We have included some relevant information on the two separate budget caps below:
• Applications Budget Cap (ABC): a cap against which scheme applications are checked to ensure that there is enough budget available based on their estimated production and resulting spend.
• Overall Scheme Expenditure Budget Cap (OSEB): a cap set above the ABC and is directly related to levy collection.
For more budget cap information, you can view on the Green Gas Support Scheme budget management page.
Tariff review
The mechanism used for amending tariffs offered to new applicants is the Annual Tariff Review. The review ensures that the scheme continues to meet its objectives and provides consistent value for money. The outcome of the review will be announced annually in the autumns of 2022, 2023, and 2024, with any changes taking effect at least one month after the announcement.
The GGSS’s degression mechanism prevents overcompensation when biomethane deployment exceeds expectations (it does happen sometimes). It will do so by automatically lowering the tariffs available to new applicants by 10% if set expenditure thresholds are expected to be exceeded within a quarter.
Expected outcomes
By increasing the proportion of ‘green’ gas in the grid, the scheme will help decarbonize Great Britain’s gas supplies. During peak production years, biomethane plants subsidized by the GGSS will generate enough green gas to heat approximately 200,000 homes. The scheme is expected to contribute to almost 3.7 million tons of CO2 equivalent of carbon savings over Carbon Budgets 4 and 5, and over 8.2 million tons over its lifetime. This is the equivalent of taking 3.6 million cars off the road for a year. It is anticipated that the GGSS will help to support high-quality jobs in the renewable energy sector, which at a time like now when economic recovery is critical, cann