Feed-in tariff scheme is shortsighted
Posted by Cathy Debenham on 8 February 2010 at 12:46 pm
A last, we've got our foot firmly on the road to making renewable energy part of the UK's energy mix.
Yes, the Feed-in Tariff rates could be higher. The government's goals for microgeneration could have been more ambitious. But the rates are probably attractive enough, especially in the current economic climate with such low rates of interest, to stimulate demand in the domestic market.
There is, however, one constituency that has been badly served by the final Clean Energy Cashback scheme.
My inbox has been filled with messages from disappointed, and often angry, early adopters of solar panels and wind turbines. These are the people who led the way, struggling with planners and with the Renewables Obligation - a system designed for energy companies not microgenerators.
They are the people whose persistence and enthusiasm can inspire others and help them tread an easier path. They are the ambassadors whose stories can help encourage more people to invest in what is still a new and expensive technology. They can debunk some of the misinformation that litters many internet forums.Immoral
Yet many of them are so angry at the cut in income the Feed-in Tariff deals them that they are talking of decommissioning their systems. One correspondent has calculated that payback on his 2.4kWp solar installation, which would have been 17.6 years under ROCs (with Scottish and Southern), has extended to 23 years.
New installations would pay back in 10 years or less. While I understand DECC's argument that these people have already invested, so don't need incentivising, I think it's short-sighted - and downright immoral to leave them worse off.
But this is what they've done. All existing microgenerators that were signed up with Scottish and Southern, Good Energy and Npower will be worse off as a result of the government's financial incentive.
I see that Good Energy is continuing with its 15p generation rate for its customers for a year and wait with interest to see whether any other energy companies try to attract the early adopters with premium export or generation rates. But, even if they do, giving a 9p rate to the pioneer microgenerators, when new installations are getting up to 41.3p, still seems like short term penny-pinching.
My other concern about the take up of the Clean Energy Cashback at domestic level is the lack of good loan or pay as you save schemes. While the government's pilot PAYS scheme is welcome, it is too little, too slow.
With just 500 households trialling it by April 2011, we'll be through the first two years of FiTs before the lessons have been learned and schemes are generally available. I wait with interest to see if the market really will provide.
This article was originally published in New Energy Focus
If you have a question about anything in the above blog, please ask it in the comments section below.
6 comments - read them below or add one