The Welsh Government has requested talks later this week with small-scale hydro operators after ministers were accused of abandoning the sector last week by scrapping a crucial business grant.
The British Hydropower Association (BHA) says ministers need to come to the table with a compromise solution which will offer continued short-term support to the sector, while a long-term solution to excessive business rates is implemented.
The association pointed to farming families who said they had been encouraged by the Minister for Environment, Energy and Rural Affairs Lesley Griffiths to diversify, and have now had the rug pulled from under their feet.
Ed Bailey, whose family run a sheep and cattle farm in Snowdonia, said: “The Welsh Government says that Welsh farming families need to diversify more to manage the risks associated with Brexit.
“But how can the farming community trust their stance if, on the other hand, the same Welsh Government is willing to pull support from those farmers who have – like us – diversified, particularly when they have the evidence of the impact this will have on those people that the grant supports?”
As a result of diversification of his business, Bailey now runs two small-scale hydro plants which were eligible for the scrapped grant. The rates grant scheme was introduced following a rates increase in 2017, which saw rateable values for some operators soar by nearly 1,000% compared to a previous valuation in 2010.
Richard Rees runs North Wales Hydro Power, which owns and operates 11 small hydro schemes mostly in Snowdonia National Park.
“Why are ministers refusing to follow the sensible recommendation contained in their own report?” he asked.
“Rather than speak with forked tongue, ministers must sit down and resolve this quickly before small scale hydro operators and Welsh farmers go out of business due to government intransigence.”
The BHA, which accused ministers last week of abandoning the sector, has been invited to a Welsh Government meeting on Friday November 27th.
Simon Hamlyn, chief executive of the BHA, said: “Last week, the Welsh Government claimed there was no evidence that small-scale hydro operators would close or be sold off as a result of the decision to scrap the business grant. This is wholly untrue.
“The government was presented with evidence by us in January which showed that 75% of small-scale hydro operators in Wales will almost certainly be affected and that some would close, and they have chosen to ignore it.
“They have also decided to ignore the solution recommended by a report which they commissioned which said that ‘Prescribed Assessment’ was the answer, a method which has previously been used by the Welsh Government to remove uncertainty for certain classes of property for ratepayers. This is the long-term solution for hydro operators.”