Details of FiT comprehensive review launched
Changes to the FiT system of allowances to encourage renewable energy have been announced on 31st October. These drastically reduce the attractiveness of the solar photo voltaic option. Following a first reduction earlier in the year for larger scale schemes this announcement affects everyone down to even the domestic roof top scheme. The success of the scheme and faster than anticipated falls in the cost of solar panels have led to a huge number of solar systems being installed but appears to have made the government run scared. Reducing the FiT now though raises serious questions as to how the government is going to meet its commitment to reach agreed levels of renewable energy output and moving the golaposts for a second time ahead of the scheduled review cannot be good for the industry or for the financing of renewable schemes.
As previously rumoured it has been announced that there is a fast-track review of the FIT, with changes to tariffs due to come into force for installations completed and registered after 12th December 2011. Installations completed and registered before this date will be unaffected. Installations registered after 12th December will receive the current tariff rate up until the 31st March and then receive the reduced to rate from 1st April 2012. Installations after 31st March 2012 will start off at the new tariff rates and potentially be subject to caveats based upon the energy efficiency rating of the registered property where the installation is sited.
Proposed new tariff rates:
| Band (kW) | Current generation tariff (p/kWh) |
Proposed generation tariff (p/kWh) |
| ≤4kW (new build) | 37.8 | 21.0 |
| ≤4kW (retrofit) | 43.3 | 21.0 |
| >4-10kW | 37.8 | 16.8 |
| >10-50kW | 32.9 | 15.2 |
| >50-100kW | 19 | 12.9 |
| >100-150kW | 19 | 12.9 |
| >150-250kW | 15 | 19.9 |
| >250kW-5MW | 8.5 | 8.5* |
| stand alone | 8.5 | 8.5* |
*These are the current tariffs, which DECC are not proposing changing and which, like all other current tariffs, will be adjusted in line with the Retail Price Index from 1 April 2012.