The Feed-In Tariff Deadline Draws Close

The tory led coalition shocked the renewable energy sector by announcing that it was going to cut the Feed-in Tariff (FIT) by 50%. Homeowners in the process of installing solar panels have until the 12th of December to complete their installation in order to receive the full payments they were promised. This news has unsettled many, after the coalition previously had pledged to be the “greenest government ever”.

The FIT is a scheme put in place where home owners get paid for the electricity they generate for the national grid. All home owners that have their solar panels installed before the 12th December will receive the higher rate tariff which is guaranteed for 25 years. The cut will see 43.3p per kilowatt hour of energy cut to just 21p. It is said that it will now take homeowners around 18 years just to break even on the cost of installation compared to 10 years pre December 12th.

The FIT Scheme introduced around 18 months ago has had considerable success with around 100,000 households installing solar power. This success has been mirrored by the number of new jobs that have been created in the solar industry. Many experts now fear there will be a loss of jobs as fewer people purchase solar panels and installation companies make less money.

Climate change and energy minister Greg Baker has responded to critics of the cut by saying the new tariff has been introduced in response to the ‘plummeting’ price of solar panels which on average fell last year from A�13,000 to A�9,000 for a basic system. He was quoted saying “My priority is to put the solar industry on a firm footing so that it can remain a successful part of the green economy. We’ve got no option but to act so we stay within budget and not threaten the viability of the feed-in-tariffs scheme”.

What is more worrying for renewable energy supporters is the potential proposal for a future FIT scheme to meet tough performance standards. Around 85% of UK homes would need to spend around A�5,600 to meet the new requirements. This proposal could offer a serious threat to the solar industry and it will become more expensive to install solar panels for your home.

Friends of the Earth’s energy campaigner Donna Hume says the changes have cast a shadow over the UK’s thriving solar industry. “The government should be encouraging more people, not fewer, to save money by making their own electricity, freeing us from the stranglehold of the big six energy firms which are pushing up our bills.”

Experts within the solar and renewable energy industry fear that this tariff will deter people from using solar energy and put an end to the thriving and growing industry.