The changes come as part of the UK Governments Banding Review for renewable technologies under the Renewables Obligation – the main mechanism for supporting large-scale renewables – for the period 2013-17.

Speaking about the bandings, which were set yesterday, Edward Davey, Secretary of State for Energy and Climate Change, said:

“Renewable energy will create a multi-billion pound boom for the British economy, driving growth and supporting jobs across the country.

“The support we’re setting out today will unlock investment decisions, help ensure that rapid growth in renewable energy continues and shows the key role of renewables for our energy security.”

Other key points from the Banding Review include:

• Support for onshore wind from 2013-17 will be reduced by 10% to 0.9ROCs, as consulted on in Autumn 2011. This level is guaranteed until at least 2014 but could change after then if there is a significant change in generation costs. A call for evidence on onshore wind industry costs will be launched this Autumn and report in early 2013. If the findings identify a significant change, the Government will initiate an immediate review of ROC levels with any new support arrangements taking effect from April 2014, with grandfathering and grace periods for projects already committed. The call for evidence will also consider how local communities can have more of a say over, and receive greater economic benefit from, hosting onshore windfarms;

• Rates of support for offshore wind will reduce as the cost of the technology comes down during the decade;

• There will be no immediate reduction in support for large-scale solar, but there will be a further consultation this year on reduced support levels given recent dramatic falls in costs.

By 2017, this package could deliver as much as 79 TWh of renewable electricity per annum in the UK – nearly three-quarters (74%) of the way towards the 108TWh of electricity needed to meet the UK’s 2020 renewable energy target.

These proposals are expected to bring forward 11 TWh more renewable energy in 2016/17 than current bandings, and stimulate between £20bn and £25bn of new investment, the Government said. The proposals also provide industry with the certainty needed to make near-term investment decisions.

Companies involved in the marine energy industry welcomed the government’s decision to increase ROCs. Neptune Renewable Energy has said it will move forward with added confidence following the announcement.

“Naturally we fully endorse the new banding level. Our business model is based on commercial viability and this is a tremendous boost for us and for our investors,” said Jack Hardisty, the company’s technical director. “The UK has great potential in tidal stream energy and today’s announcement demonstrates that the government recognises this.”

Neptune Renewable Energy deployed a full-scale experimental demonstrator device in the Humber in January and is planning to deploy arrays of similar devices around the UK.