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YouGen press release

Clarity on grants and feed-in tariffs for microgeneration at last!

Posted on 2 September 2010 at 11:52 am

YouGen welcomes DECC’s clarification on grants and feed-in tariffs. Many schools and community groups have endured a long period of uncertainty, having been told they could not claim the feed-in tariff unless they paid back grants received under the Low Carbon Building Programme. They also did not know what rate of feed-in tariff they would get if they kept the grant.

“This was devastating news for many organisations who had fundraised to install microgeneration equipment such as solar panels or wind turbines, and then found that the rules had changed, and the calculations they had made before investing no longer held true,” said Cathy Debenham, founder of YouGen. “After months of waiting (and worrying) for a ruling on EU law on state aid, last week's  announcement has brought relief to many.

“These are often pioneering projects, which have only come about through the vision and hard work of a group of volunteers. They educate and inspire others, and are key to the process of normalising renewable energy. As such, you would expect them to be met with encouragement by government – and at very least for them not to have the rug pulled out from under them.”

Whether the grant must be paid back or not depends on the size of the installation and the size of the grant. If the projected total income from the grant plus the feed-in tariff comes to less than the 'de minimis' threshold of 200,000 euros in a three year period (which it will in most cases), then there is no need to pay back the grant.

This means that:
People who were awarded LCBP grants for domestic installations that were commissioned after the 1 April 2010 are now eligible for the feed-in tariff under the de minimis rule. (For examples of people who fell foul of this see the comments section of this blog.)
Community projects, schools and other public sector organisations that received LCBP phase 2 grants will need to do some calculations. Add together the grant, plus the projected income from both export and generation tariff of the feed-in tariff over a three year period. If it comes to less than 200,000 euros, they can keep the grant.
Farmers who were hoping to install renewable energy with a grant from the rural payment scheme and receive the feed-in tariff are out of luck, as the de minimis threshold for agriculture is set much lower at 7,500 euros.

Claiming the feed-in tariff is easy for installations under 50kW. They just need to make a declaration about their de minimis status to their feed-in tariff supplier (this is their electricity company).

The only group now left waiting to hear their fate under the feed-in tariff are the early adopters who installed their microgeneration before the cut off date of 15 July 2009, and receive a much lower rate of feed-in tariff as a result. Prior to the election the Conservatives promised to pay microgeneration pioneers the same rate as new installers, but have gone very quiet on the matter since taking office. It's unlikely that an announcement will be made before the spending review in October.

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