Feed-In Tariff review gets underway

Chris Huhne

Energy Secretary Chris Huhne is reviewing the Feed in Tariffs (FITs) scheme following growing evidence that large scale solar farms could swallow up money intended to help homes, communities and small businesses generate their own electricity.

More than 21,000 installations have been registered since FITs began in April 2010.  The vast majority of these are domestic installations, including solar panels, wind turbines and microhydro plants. So far, the scheme has been described as a “huge success” at stimulating green growth, driving innovation, creating jobs and cutting carbon in the UK.

However, the scheme is at risk of an increasing number of large scale solar farms which could push FITs costs off track. Last year's Spending Review committed the Government to save 10 per cent of the costs of FITs in 2014-15 through a review due to start in 2012 or earlier if uptake exceeded Government expectations.

The Government has now launched a comprehensive review into the scheme and hopes to publish details next month of its measures to support renewable heat within the budget agreed at Spending Review.

Chris Huhne said: "The renewables industry is a vital piece in the green growth jigsaw and this review will provide long term certainty while making sure homes, communities and small firms are encouraged to produce their own green electricity.

"Large scale solar installations weren't anticipated under the FITs scheme we inherited and I'm concerned this could mean that money meant for people who want to produce their own green electricity has the potential to be directed towards large scale commercial solar projects."

The comprehensive FITs review will:

  • Assess all aspects of the scheme including tariff levels
  • Be completed by the end of the year, with tariffs remaining unchanged until April 2012 (unless the review reveals a need for greater urgency)
  • Fast track consideration of large scale solar projects (over 50kW) with a view to making any resulting changes to tariffs as soon as practical, subject to the Energy Act 2008.

The Government has stated that any changes to generation tariffs implemented as a result of the review will only affect new entrants into the FITs scheme. Installations which are already accredited for FITs at the time will not be affected.

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