Consultation Proposes Large Cuts to Feed-in Tariffs

[ALEO Admin]

The Department of Energy and Climate Change opened a consultation on the Feed-in Tariffs (FiTs) scheme on 27 August 2015, proposing large cuts to tariffs by January 2016, and potentially even ending generation tariffs altogether, for new applicants, by this date. Export tariffs could be retained, however, but at reduced levels.

The deadline for responses is 11.45pm on Friday 23 October.

The proposed tariff reductions are much larger than were generally expected. For example, smaller-scale solar PV installations currently eligible for 12.47 pence per kilowatt hour, would only receive 1.63 pence per KWh under the proposed new tariffs - an 87 per cent cut.

The consultation seeks views on the impacts of the scheme's closure, whether implemented in the immediate term or as a phased closure over several years. However, the consultation also discusses possible future directions for small-scale renewable support, which could build on, or replace, FITs.

In particular, the consultation looks at:

• "Ways of introducing competitive allocation to drive down costs and increase value for money for bill payers. We wish to take views on the practical implications, advantages, and disadvantages of such a change."
• "Restricting small-scale renewables support to particular groups, such as householders and community groups, or particular technologies, such as solar PV, which appears closest to achieving subsidy-free existence with a final push of public support."
• "Limiting support to metered export so small-scale generators continue to have a route to market for the renewable electricity they produce."

The proposed generations tariffs, compared with existing levels, are given in the consultation document, as shown below:

FiT-tarrifs.gif (35.48 KiB) Viewed 4661 times

The proposals are to reduce these generation tariffs, through a quarterly default degression mechanism. For solar PV, this system would mean that the generation tariffs would reach zero by January 2019.

Anaerobic digestion tariffs would not change under these proposals.

The consultation also does not propose any change to export tariffs at this stage. However, DECC are consulting on options to "ensure the long-term sustainability of the export tariff".

These options are:

• Withdraw the right for >50kW installations to opt for the export tariff
• Re-base the export tariff to a lower level
• Formalise annual re-set of the export tariff to a wholesale power price index

Overall, the proposal is to limit the maximum overall budget for FiTs to £75-100 million, from January 2016 to 2018/19. The consultation also proposes ending generation tariffs earlier, possibly by January 2016, if the new caps do not prove to be sufficient in controlling the cost of the scheme.

DECC proposes to put in place a rule to prevent new extensions claiming support under FITs and to end deemed exports in favour of fully-metered exports. This would include exiting FiTs installations, using smart meters.

Other proposals include raising the energy efficiency requirement for the higher tariff bands form EPC certificate band D, to band C, with a possible exemption to this C band requirement for fuel poor households, providing loft and cavity wall insulation has been installed, where possible.

To read the full consultation document, visit:
https://www.gov.uk/government/consultat ... iff-scheme

For a report from the Guardian, visit:
http://www.theguardian.com/environment/ ... o#comments

[ALEO Admin]

The Government published its response to the consultation on changes to Feed-in Tariff accreditation on 9 September 2015.

This document confirmed that the ability to pre-accredit under the FIT scheme, will be removed as of 1 October 2015, and says this will "limit the value of the deployment surge in response to tariff reductions".

The Solar Trade Association (STA) has condemned the Government's decision to seemingly go against public opinion and the advice of the industry - with only 16 out of the 2,372 consultation respondents supporting the proposal.

To download the more information, visit:
https://www.gov.uk/government/consultat ... reditation

For more on the STA's reaction, visit:
http://www.solar-trade.org.uk/governmen ... editation/

[ALEO Admin]

Slides from DECC's recent workshop on the Feed-in Tariff review, held in London on 5 October 2015, can be downloaded from:
http://www.bpva.org.uk/media/174131/fit ... tation.pdf

[ALEO Admin]

The National Carbon Action Network has now responded to this consultation.

Please see:
http://www.can.uk.net/forum/viewtopic.php?f=86&t=691