The British Wind Energy Association (BWEA) and the Renewable Energy Association (REA) have issued a joint statement signalling their support for a proposed amendment to the Energy Bill that would give the government the power to introduce a feed-in tariff to support small-scale renewable energy technologies while retaining the existing Renewables Obligation (RO) subsidy mechanism.

A previous attempt to amend the Energy Bill proposed by the REA and Friends of the Earth and similarly designed to introduce a feed-in tariff for onsite renewable energy was narrowly defeated by the government, despite the largest backbench rebellion of Gordon Brown's time in office.

The BWEA did not support that amendment amid concerns that a failure to clearly define what constitutes microgeneration technologies would lead to confusion over whether projects qualify for the feed-in tariff – which works by guaranteeing buildings generating energy an above-market price for any power they feed back into the grid – or the existing Renewables Obligation (RO) incentive mechanism – a subsidy scheme that allows operators of green energy projects to sell so-called Renewable Obligation Certificates (ROC) alongside any energy they produce.

However, the new amendment has addressed these concerns by proposing that the government is given the power to introduce a feed-in tariff and is then formally obliged to undertake a consultation process to work out which projects will qualify for the tariff and how it will be delivered to energy generators.

In a joint statement with REA chief executive Philip Wolfe, BWEA chief executive Maria McCaffery said the two bodies believed that an amendment with cross-industry support has a "high chance of success" when the bill receives its next reading in the House of Lords.

Meanwhile, BWEA director of economics and markets Dr Gordon Edge warned legislators to ignore recent calls for any new feed-in tariff to be expanded to cover all renewable energy projects, a move that would see it effectively replace the existing RO mechanism.

"I cannot emphasise enough the impact further changes to the support mechanism for large renewables projects would have on investor confidence," he said. "The RO is complex at first glance, but people are used to it – can we please stick with it." He added that the reason the UK was lagging behind many of its European counterparts in terms of renewable energy capacity was a result of problems with the planning system and difficulties connecting projects to the grid, rather than issues with the RO.

However, Edge advised that minor reforms to the RO were required to ensure the continued success of the scheme. Currently, the RO is scheduled to end in 2027 and according to Edge this is already beginning to cause concern among some offshore wind project operators. "If you are looking at 20 years to maximise your return on investment, which is not unusual for some offshore projects, you need visibility over what happens beyond 2027," he said. "I am already seeing worried looks on some project developers' faces over 2027."