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Despite the disappointment and financial costs, the over valued FiT did create an environment that saw the entire global PV industry take note and focus on the UK market

Treasury was forcing the hand of the DECC (Department of Energy and Climate Change) and accusing the department of incompetence. Many of the same people were involved in encouraging the original additive to the Nuclear Bill. In both instances the evidence is of pressured decisions with rushed consultation and decisions.


Mr Barker’s announcement followed the fast- tracked review of large scale solar feed-in-tariffs announced in February. Mr Moss said that he was of the opinion that the situation had arisen out of incompetence at DECC. “Mr Barker presented the original DECC document to the Treasury without understanding the content of or the complexity of the FiT proposal,” said Moss. “ Through lack of understanding, he delivered a proposal with just enough tariff for domestic roof top, yet in October presented the CSR and said all was rosy in the garden for all the industry. Four weeks later he realised his mistake and insulted the large scale community calling us ‘gold diggers and speculators’. In the mean time, we have continued to invest millions of pounds into this industry on the basis we believed the government was committed to a multitude of renewable streams.”

Commercial investors have warned that cutting the FiT, only one year after its inception, will potentially sign the death warrant for Britain’s renewable power industries. “The whole investor market was totally disengaged as a result of the feed in tariff being ripped up,” said Ben Warren, an industry consultant working with Ernst and Young. “It’s an absolute disaster,” said Ray Noble, a board member of mO3 Power and a solar specialist at the Renewable Energy Association. “No new projects will start after this comes into effect.”

Climate Change Minister Greg Baker said that he wanted the available subsidy, which is paid for by levies on consumers power bills, to be used for small scale domestic solar arrays that will increase the ‘public’s engagement with renewable energy’. The doom and gloom comments are relevant if you have invested in a large scale ground based PV solar farm or project but is the negativity valid for the entire solar industry?

Longer term impacts

Whilst there is no doubt that the government handling of the FiT review has been poor and undermined investor confidence in the UK renewable market it would be disingenuous and melodramatic to suggest that the proposals are a death knell for the entire industry. The government has done the industry a disservice by changing the playing field as partnerships and investments will falter based on the changes.

These effects have begun with WRS Energy announcing that a solar park planned for farmland in the UK has been scrapped due to the government change in policy. The government has talked about giving until August the 1st for current project okay but the reality is that they would need an operational okay from Ofgem and there is no large scale solar project advanced enough in the UK to meet this deadline. WRS Energy had submitted plans to North Somerset Council to build a two megawatt solar farm and initial investments had been sought. The change in government attitude meant that the council required further information for planning permissions as they are unsure of the implications. This will be the first in a long line of expected announcements.

Despite the disappointment and financial costs, the over valued FiT did create an environment that saw the entire global PV industry take note and focus on the UK market. This may not have happened and the result is that some foreign companies are too far in to waste their investment and will continue to develop a local market and industry. The focus will shift to domestic usage but this is in line with the original goal of renewable micro- generated energy to tackle fuel poverty in domestic settings while contributing to the lower emissions requirements. Another key point is that the review is still in consultation and the time is still there for industry to input to ensure the changes that will occur go some way to addressing reasonable fears.

The present suggestion is to slash all activity above 50kw and based the review on the almost 170MW of projects submitted for planning. A quick use of the calculator showed that the pot of money earmarked for the subsidy would not even cover these projects. The proposal is to cut FITs for PV systems to 19p/kWh for installations of 50-150 kW, 15p/kWh for installations 150-250 kW and 8.5p/kWh for installations of 250 kW to 5 MW or stand-alone developments. With the original tariff set 32.9p/kWh for installations of 10-100 kW and 30.7p/kWh for developments of 100 kW to 5 MW or Issue V 2011

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