UK government unveils new plans for feed-in tariffs

The UK government has today announced its plans for the future of feed-in tariffs (FITs) in a bid to draw a line under recent controversy and rebuild confidence in the scheme.

The driving force for the reforms, according to the government, is a 45% reduction in the estimated cost of installing solar photovoltaic systems since 2009 and surging installations, which has put a strain on the FIT budget.

But today’s announcement promises to use “budget flexibility” to cover the overspend from the high uptake of solar photovoltaics, while bringing down the rate to 21p from April 1. The government says there will still be £460 million in the budget for new installations.

“Our new plans will see almost two and a half times more installations than originally projected by 2015… [and] a more predictable and transparent scheme as the costs of technologies fall, ensuring a long term, predictable rate of return that will closely track changes in prices and deployment,” said Climate Change Minister Greg Barker in a written statement.

As expected, the new proposals, which are open for consultation for the next eight weeks, would see domestic-sized solar installations with an eligibility date on or after March 3 receive a FIT of 21p down from the original rate of 43.3p.

But the government is relaxing the previous proposal to require that a property must have Energy Performance Certificate rating of ‘C’ or above to receive the FIT. That requirement has now been downgraded to a ‘D’ rating or better.

The revised scheme will also set ‘multi-installation’ tariff rates of 80% of standard rates for individuals or organisations with over 25 installations.

The government has also pledged to increase the tariff for micro-combined heat and power (CHP) installations as promised earlier this month.

However, the new plans do not give any certainty to those installing solar panels between December 12 and March 3. The government has until February 21 to lodge its case with the Supreme Court.

For further information:
www.decc.gov.uk/en/content/cms/meeting_energy/Renewable_ener/feedin_tariff/feedin_tariff.aspx

Related stories:
UK government promises to raise feed-in tariff for microCHP (3-Feb)
UK government to take solar feed-in tariff appeal to Supreme Court (26-Jan)
UK government attempts to end uncertainty over feed-in tariffs (20-Jan)

09 February 2012

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