Damian Baker, managing director for RenEnergy has responded to the government’s recent announcement regarding solar subsidies stating, “We welcome the clarity offered by today’s announcements by DECC regarding the Feed-in-Tariff (FiT). There are no retrospective changes and we have a clear framework in which to work for the next few months, with high rates of return on investment still available for consumers.
“The proposed new system looks very similar to Germany’s which has proved successful with an installed capacity of 28GW. DECC has today set a UK a target of 22GW solar capacity by 2020, which demonstrates a clear commitment to Solar.
“We would strongly urge people not to wait if they’re considering installing PV. The government is desperate to reduce the returns offered by Solar from current rates of around ten percent to somewhere around five percent. The FiT will also be cut every few months and there are government proposals to remove indexations and reduce the term of the tariff from 25 to 20 years. The benefits to installing PV will never be as great as they are right now.”
However, David Hunt, a director with Eco Environments, was scathing of the announcement. He said, “A reduction to a tariff as low as 13.6p in just a few months’ time is the equivalent of armageddon for the solar industry.
“There is simply no way that product and installation costs will drop that much in such a short period of time to make such a low tariff rate economically viable. Together with a dramatic slashing of FiT rates in July, ministers are also proposing ongoing six month reviews, a reduction from 25 to 20 years for the FiT rates being applicable for Solar PV and the removal of RPI linked payments.
“These cuts and proposals fly in the face of Greg Barker’s declared ambition to encourage the installation of 22GW of solar before 2020, with the changes recommended there will be no one willing to buy and no one left to install it. Yet again the government, even with a newly appointed energy secretary in Ed Davey, seem happy to watch the solar industry lurch from one crisis to the next.
“It is crucial that ministers listen properly to the industry this time and ensure that the consultation process on future tariffs is a robust process rather than last time’s sham. Rather than looking to encourage consumers to embrace renewable energy technologies, you would think the government was trying to turn people away from them.”