The Greenest Government Ever ???

Feed-In Tariffs (FIT’s) were introduced as part of the Clean Energy Cash back initiative in April 2010. This scheme was introduced to encourage homeowners, small businesses and communities to improve the energy efficiency of their properties by installing renewable energy technologies.

The FIT scheme was based on energy suppliers paying customers for generating their own green electricity. It could be used in conjunction with following technologies;

• Solar electricity (PV) (roof mounted or stand alone)
• Wind turbine (building mounted or free standing)
• Hydroelectricity
• Anaerobic digestion
• Micro combined heat and power (micro CHP) (limited to a pilot at this stage)

The following diagram illustrates how FIT’s generate money/savings through the use solar panels.



Diagram taken from; www.energysavingtrust.org.uk.

   

 

Since the scheme was introduced in 2010 it has been a huge success. It has boosted the solar industry with the installation of 100,000 solar panels, created more than 22,000 jobs and almost 4,000 new businesses.

This level of success teamed with claims that large-scale solar farms were ‘soaking up money’ from the scheme lead to a review of the FIT scheme which had been planed for 2013. In March 2011 the Energy Secretary Chris Huhne launched a comprehensive review which was to be completed by the end of 2011, with tariffs remaining unchanged until April 2012 . The findings of this review lead to a second review and it was confirmed on the 31^st October 2011 that despite the original brief the government now plan to make cuts of more than 50% to the current tariff rate from 12 December 2011. This will mean that anyone installing solar panels after this date will receive only 21p per kilowatt hour for the electricity generated by their panels, from the 43.4p for panels installed before this date. The government have said that halving of this subsidy rate was necessary, as otherwise the scheme would cost more than the £860m allocated.

This announcement has been met with strong opposition from companies within the energy industry, politicians and the general pubic. Solar companies say thousands of jobs will be lost within the industry, which currently employs around 25,000 people in the UK. Several of these companies are bringing legal actions against the government, arguing that the government has acted illegally in bringing in the changes so hastily, before a consultation has taken place.

Liberal Democrat councilors are preparing to revolt over the coalition government's crackdown on solar subsidies, as a growing number have been greeted with stiff opposition from outraged householders and companies fearing job cuts. Local councilors are being advised to push for a postponement of the subsidy cuts, as a minimum. Most politicians are particularly concerned about the future of local schemes to install solar panels on social housing, which will help to rescue people from fuel poverty.

The feed-in tariff scheme was helping to grow the solar industry and get more people into work. This sudden change to the feed-in tariffs is putting this at risk and it will also create uncertainty in the government's other flagship climate change policies. And this was meant to be the greenest government ever?

All views on this matter welcome.