DECC published it’s ‘Feed-in tariffs scheme: consultation on Comprehensive Review Phase 1 – tariffs for solar PV’ in October 2011.
The government’s existing feed-in tariffs (FITs) scheme was introduced in April 2010 and was designed to offer an incentive to organisations, businesses and individuals to invest in small scale low-carbon electricity generation technology. The scheme offers those that have fitted eligible, wind, solar PV, hydro, anaerobic digestion or domestic-scale CHP installations a guaranteed payment from an energy supplier for the electricity they generate and also for the surplus electricity they supply to the grid.
The 2010 Comprehensive Spending Review committed the government to finding £40 million of savings from the FITs scheme. The DECC consultation proposed reforms to the FITs schemes for solar PV installations including:
- Reducing the level of FITs, by approximately a half. These rates are designed to offer a five per cent rate of return for well-located installations.
- Implementing the revised tariffs from the 1 April 2012, but from that date the revised rate would apply to all installations fitted on or after the 12 December 2011.
- Introducing a new multi-site tariff, for individuals or organisations that receive FIT payments from installations at more than one location. This tariff would apply to all new solar PV installations which are part of aggregated schemes form 1 April 2012. The proposed rates are approximately 80 per cent of the proposed standard tariffs.
- Only allowing installations fitted to a building after 1 April 2012 to be eligible for FITs if the FIT generator can demonstrate that the building meets a certain level of energy efficiency (the consultation suggests an Energy Performance Certificate rating of C or above). In an interim period (between April 2012 and April 2013) buildings will have one year in which to install insulation measures.
In summary our response to the consultation raised the following issues:
- London Councils supports in principle the consultation’s proposals to reduce the level of feed-in tariffs (FITs) for solar PV installations.
- However we strongly oppose the proposed reference date of the 12 December, and are concerned about the large number of projects currently in development by London’s local authorities and social housing providers that this proposed date puts at risk. A list of these threatened schemes is included in our response.
- We do not believe a multi-site tariff is appropriate, as this will reduce the number of schemes installed by local authorities and social housing providers, which have an important role to play in supporting community facilities, such as schools, and tackling fuel poverty in low-income households.
- We agree in principle that eligible installations should be restricted to buildings that meet a reasonable level of energy efficiency. However this rule should be applied flexibly to take account of proposed schemes where energy efficiency measures are not possible or appropriate but where the scheme offers significant social benefits.
- We believe that the period of 12 months proposed in the consultation as a transitional arrangement to allow installers of solar PV schemes to upgrade the energy efficiency of their building, should be extended. All installers should be given a full year after the implementation of the Green Deal, which many will rely on to finance energy efficiency measures.
Our response to the consultation can be downloaded below.