Providing certainty for Feed-in Tariffs and the Renewable Heat Incentive

Published on Monday, 23 July 2012 12:22
Posted by Scott Buckler

Greater certainty for investors in renewable heat and small scale electricity technologies and a fair deal for consumers were delivered by Energy and Climate Change Minister Greg Barker, as he clarified future arrangements for Feed-in Tariffs and the Renewable Heat Incentive

Feed-in Tariffs

The final package of changes to the FITs scheme has been announced by the Department of Energy and Climate Change (DECC) today, following consultation in February this year. This is part of a comprehensive review designed to ensure value for money for the consumer and long term certainty for those who choose to invest.

The changes will affect tariffs for all newly eligible FITs technologies from 1 December 2012 onwards. Changes to solar tariffs, which have already been announced, will take place from 1 August 2012.

A degression mechanism will be introduced for Anaerobic Digestion (AD), wind and hydro from April 2014 in line with uptake of these technologies. Tariffs will be published two months before the degression date and will be based on publicly-available data. Decisions on the degression mechanism for solar were outlined in the Government response published on 24 May 2012.

Energy and Climate Change Minister Greg Barker said:

"I want to provide long term certainty for those choosing to invest in all forms of small scale green electricity generation, not just solar, and our changes to FITs will do just that.

"As well reducing tariffs over time for AD, hydro and small scale wind in line with uptake, we are introducing tariff guarantees for all technologies, great news for projects with long lead in times like hydro power.

"We are also planning to remove the energy efficiency requirement for community and school solar projects in recognition of the hard to treat nature of community buildings often involved in such schemes, and the educational benefits that they can bring. These types of projects will also be able to get tariff guarantees for installations of any size, making it easier for communities to get involved in clean green local energy generation."

Dave Sowden, Chief Executive of the Micropower Council said:

"We welcome what is broadly a very positive set of proposals that should bring greater confidence to investors and customers. In particular the decision to increase the export tariff, the clarification of cost controls for microCHP, the community proposals and the decision not to extend energy efficiency requirements beyond PV are welcome developments.

"We will continue to monitor progress of the technologies supported by FITs with a view to maintaining constructive dialogue with DECC to inform further developments to the scheme."

Paul Thompson, Head of Policy at the Renewable Energy Association said:

"These decisions demonstrate that DECC has listened carefully to industry concerns, and should restore certainty to the sub-5MW sector. We particularly welcome the support for community schemes and the improvements to the cost control mechanism. The introduction of tariff guarantees for projects at a relatively early stage is also very helpful, and we look forward to a similar approach being extended to the Renewable Heat Incentive."

Source: ©DECC

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