This Extended Expert View is a brief analysis of the Renewables Obligation (RO) year 2003/04. It is based on Ofgem's second annual report on the RO, published in February 2005, and supplemented with Datamonitor's proprietary data. The principal focus of the document is to examine the strategies adopted by each of the main power retailers in fulfilling their RO commitments in the 2003/4 year.

• Analysis of strategies adopted by UK suppliers to fulfil their Renewables Obligation.
• Forecast of UK suppliers' ability to match their 2005/06 obligation with ROCs issued to their own generation facilities.

"Four companies chose to produce ROCs from their own capacity in a significant way. Scottish and Southern's generation facilities were issued with nearly as many ROCs as all of the other main retailers put together: 980,000 versus 1,175,000 for the rest.

"There was no unanimity on whether the buyout fund was preferable to bilateral trading. RWE npower made by far the largest contribution to the buyout fund, ?64m, because it covered 84% of its obligation from the buyout fund. Centrica made only a negligible contribution to the fund, and Total made none.

"Scotland has a large surplus of renewable energy, which it is able to export to England and Wales. Retailers in Scotland bought 540,000 ROCs from the buyout fund, meaning that Scotland could have entirely covered its own obligation and still have had 670,000 left to sell to England and Wales.

• Understand the strategies that different suppliers adopted to meet their Renewables Obligation in 2003/04.
• Understand the extent to which each main UK power supplier is exposed to the buyout fund.