Published on Monday, Jan 23 2012 by TECG News desk
You would be forgiven for finding it hard to keep tabs on the latest happenings with regards to the Government’s Feed-in Tariff (FiT) scheme. With this in mind, we have put together this information to not only provide some much needed background on the FiT but to also let you know the very latest developments.
The FiT scheme has been the source of much confusion with consumers of late. However, the one thing customers need to know is that if you install your solar PV before the end of March, you are a guaranteed at least £0.21p per kWh. This could provide you with a significant financial return of 10%.
Because the government cut the original rate from £0.43p per kWh to £0.21p per kWh BEFORE the consultation period had run out, key players in the solar panels industry have launched an appeal.
There is still a chance that if the original £0.43 per kWh rate will be upheld if your installation was completed between 12th December 2011 and 3rd March 2012 whereas the rate was originally cut with effect from 12th December 2011.
The High Court has already labelled the early cuts as legally flawed. Read more here.
The Background
The Feed-in Tariff scheme was introduced by the outgoing Labour Government in April 2010 and upheld by the Coalition Government when they won power in May of that year.
The Feed-in Tariff scheme was extremely successful, with lots of PV installations happening on the back of it as consumers and installers sought to wisely take advantage of the generous £0.43 per kWh payments for electricity produced by the solar PV installation.
The scheme was far more successful than originally anticipated and on 31st October 2011, the Department for Energy and Climate change announced their intention to cut the rate for domestic properties. Initially, the need for cuts was agreed in the industry as spreading the payments out would ultimately help more people and benefit the environment more in the long term.
All the way to the High Court
However, the fact that the cut was suddenly brought into effect before the consultation period had ended angered lots of people in the industry. The High Court also agreed that the early cut was unreasonable. They also stated that it was actually illegal.
This news was greeted warmly by some solar bosses; however some leaders in the industry worried that the industry would be affected even more because of the prolonged appeal.
The DECC fights back
The DECC did not take this ruling lying down and launched a fresh appeal against the ruling of the High Court. They stated that they believed the ruling to have been made because of the perceived damage to the actual object of the Feed-in Tariff scheme – to encourage homeowners to invest in renewable energy systems and get 20% of the UK’s energy produced by renewable energy resources by 2020.
They disagreed, stating:
‘The overriding aim of the proposed reduction in tariffs for solar PV (as set out in the recent consultation) is to ensure that over the long term as many people as possible are encouraged to install small-scale low-carbon generation (including other technologies as well as solar PV) and benefit from the funding available for the FIT scheme.’
They also stated that the scheme had already maxed out its budget for the financial year 2011/2012.
The application for appeal and the appeal itself if granted was set to take place on January 13th.
Still awaiting the final decision
As of 19th January 2012, the High Court has not yet decided whether to uphold its original decision or grant the government’s wishes.
The DECC have announced that:
‘The Court of Appeal has not yet decided whether to give permission for an appeal or made a judgement on the FITs case. The Court will wrap up the decision on permission for an appeal and a possible judgement if an appeal is allowed in the next few weeks. Once the outcome is known we will consider our options and make an announcement on the way forward to provide clarity to consumers and industry.’
For consumers installing solar PV
We urge customers not to be put off by the escalating uncertainty and confusion that has been clouding the industry since the initial cuts were announced and implemented on the 12th December.
What we can be absolutely certain of is that anyone installing solar panels with an MCS registered solar PV installer like The Energy Conservation Group before 31st March will definitely get a Feed-in Tariff rate of at least £0.21p per kWh.
Don’t leave it too late
Even if the High Court does not insist that the £0.43 rate is backdated to customers who had their installations completed after 12th December, the £0.21 per kWh rate is still very generous and a fantastic investment. You are guaranteed a 10% ROI when you do this.
No other investment currently can guarantee such a financial return.
This is why we advise you to take advantage of solar PV while the £0.21 per kWh rate still applies.
The Energy Conservation Group is an MCS registered solar panels installer and we have over ten thousand installations to our name. We have lots of very happy customers who have used us for our installation and been very impressed by our unique combination of quality and cost effectiveness. This excellent juxtaposition of wallet-friendliness and high quality means that we are able to offer a market-leading 12 year warranty on our installations.
Want to find out more? Contact the author.