Feed in Tariffs, the drama continues...

solar sunset

This week could not pass by without at least some comment on the government’s announcement on the Feed-in-Tariff (FITs).  If you’ve not already heard, on Monday, Chris Huhne launched a comprehensive review of the FITs, ending months of speculation and rumour that adjustments would be made in response to the interest shown in industrial-scale solar farms. A summary document is available here.

The review, originally planned for 2012, covering all aspects of the scheme including tariff levels, administration and eligibility of technology has been brought forward by a year with the intention that it will be completed by the end of 2011. The statement also announced a fast track consideration of large-scale PV projects (over 50kW).

The government’s position is that the FIT was not intended to subsidise large-scale commercial farms and that with an increasing number of solar farms being granted planning permission, changes are needed to safeguard the FIT for small-scale installations by homeowners, schools and community groups.

The announcement of the review, whilst long expected has been met with a mixed response. Those championing micro-generation have come out in support of the early review, as have those backing farm-based Anaerobic Digestion. Others are understandably uneasy and dismayed.

Should large-scale installations receive the same treatment as community schemes? Maybe not. But, what will the effect on the burgeoning PV industry be? The FIT is intended to incentivise renewable energy generation, and the fact that it has been successful in stimulating growth, innovation and job creation indicates it is working. 

Changing things now could prove counter-intuitive –large-scale projects on council, school, hospital and business roofspaces could be suspended or scrapped. Does it really matter that large-scale commercial operations are against the “spirit” of what was intended?

Whilst domestic installations make up the majority of the 21,000 registered to date, I haven’t heard a convincing argument that they alone will bring the seismic shift needed.

The government has confirmed it won’t act retrospectively, but the changes have implications for the many projects in their planning stage. Clarification can’t come soon enough.