Feed-in tariff review: an update
Posted by Cathy Debenham on 22 February 2011 at 1:44 pm
Concern that large-scale solar is set to take a significant quantity of the set amount of funding is the main driver of the feed-in tariff review, according to RegenSW chief executive Merlin Hyman, who recently met Greg Barker MP, the minister responsible for feed-in tariffs at DECC.
Barker is determined that the feed-in tariff budget of £900m between 2010/11 and 2013/14 is not swallowed up by one technology. He also believes the tariffs should be aimed at domestic and community-type installations, not investors - and so is determined that large-scale projects won't take a major share of the funding.
The review process will begin with a formal consultation document that will be published in a couple of weeks. This will set out:
- A 'fast-track' review of the tariffs for 'large-scale' PV of over 50 kW and for farm-scale anaerobic digestion (where there hasn't been as much take up as hoped).
- A comprehensive review of the Feed-in Tariffs that will run until the end of 2011 and will result in changes in tariffs and scheme design to be implemented for April 2012.
Fast track review
Greg Barker was clear that he hopes to have changes to the tariff for large-scale solar from the fast-track review implemented by the time of the Parliamentary recess on 19 July 2011. It was also clear that, although this is a consultation and conclusions from it will be evidence based, DECC's expectation is that the fast track review will conclude that changes to tariffs are necessary to make large-scale solar projects much less attractive.
Installations that are already generating and accredited for feed-in tariffs will not be changed retrospectively. However, projects in the pipeline at the time of the changes will not be eligible for the tariff at the current rates.
Solar projects below 50 kW and all other technologies should be 'safe' from tariff changes until April 2012 - unless evidence reveals a need for greater urgency.
Barker stated his desire for a more dynamic tariff-setting process for feed-in tariffs in future. He gave the example of the Monetary Policy Committee. which regularly reviews interest rates and referred to the German approach to feed-in tariffs. It's clear that the introduction of a fixed budget for feed-in tariffs has fundamentally changed the nature of the scheme and that a new mechanism is needed to replace periodic reviews and provide a more secure footing for investors.
Photo by Living Off Grid
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