On 20th July, the Department of Energy & Climate Change (DECC) announced changes to the Feed-In Tariff scheme (FITs) that affect renewable energy technology.
Louis Fell, Partner at George F White
The announcement confirms new Feed-In Tariff schemes levels (see Editor’s notes) will not come into effect until 1st December 2012, a delay of two months from the government’s original proposals. While Feed-In Tariff schemes are reduced as expected, the announcement confirms an increase in the export tariffs to 4.5p/kWh from 1st December. The decision introduces a scheme of preliminary accreditation which will allow developers of greater than 50kW projects to lock into tariff levels early in their development in order to reduce risk and assist in securing finance.
Eligibility for this accreditation will require planning approval and a firm grid connection. Preliminary accreditation would be available for six months in the case of solar photovoltaic, one year for anaerobic digestion and wind installations and two years for hydro schemes.
Louis Fell, Partner at George F White, says: ‘‘This announcement provides greater confidence to businesses investing in renewable technologies. The stage is now set for the future of small and medium scale renewable energy and there is much potential for those who have an interest in exploring these possibilities. Whilst the Government has, in most cases, reduced tariff levels to reflect developments in the renewable energy industry, it is clear that the Feed-In Tariff will continue to support investment in renewable energy at attractive rates. This brings the export tariff closer in line with the sale price of electricity and will have a very positive impact on project payback for schemes with no Power Purchase Agreement (PPA) in place. ’’
The government's Feed-In Tariff scheme means a farmer or landowner get money from their energy supplier if they install an electricity-generating technology from a renewable or low-carbon source such as solar PV or wind turbine.
Farmers and landowners can be paid for the electricity they generate, use it themselves, and receive further payment for any surplus electricity they export to the grid, saving money on their electricity bill, as they will by using their own electricity. Once locked in the tariff levels will stay the same for the next twenty years.
George F White Renewables has an in-depth understanding of renewable energy and property. As independent and professional consultants they are able to advise on the most appropriate package for a specific circumstance and then assist with planning, procurement and through to delivery of the finished project.
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