FiTs under threat
The feed-in tariffs currently paid to small-scale generators of renewable electricity face being cut by as much as 75 per cent.
It emerged this week that officials at the Department of Energy and Climate Change (DECC) are pushing for cuts because they believe the current level is unaffordable
Currently consumers can earn 43p per kilowatt hour for power generated by rooftop photovoltaic (PV) arrays. What is being proposed would cut that to just 9p per kWh. This follows the dramatic cut to the tariff for large-scale solar schemes earlier this year.
Drastic
DECC had recently decided to review the scheme, but had promised there would be no change before April 2012 “unless the review indicates the need for greater urgency”. It looks likely that the change will come sooner and could be more drastic than previously thought.
The Financial Times reported a coalition source saying that money had been “flying out” of the scheme’s fixed budget and that the original tariff levels had been set “embarrassingly” high. Domestic PV installations are up by over 50 per cent since this summer on the back of FiTs and solar schemes account for 97 per cent of all projects receiving this subsidy.
Some of the companies providing ‘free’ solar arrays to consumers in return for their FiTs had said that they might still be able to absorb a cut of 50 per cent in the tariff, but anything more than that would make the payback uneconomic.
