Feed in Tariff review, a great energy scam? Or lobbying at its worst?

[Darren T Archer]

The Feed in Tariff review is a terrible blow to green energy. Especially when you do the maths and realise that if an electricity company charges more than 15p for a unit of its electricity they will actually be making a profit for every unit of electricity they get from domestic systems without raising a finger or a penny to help towards the cost.
It's a total disgrace and to dress it up as a way of protecting a non existent budget is insulting.

Sign the petition and get this disgrace over turned!

http://epetitions.direct.gov.uk/petitions/20760

[Geoff Stow]

It seems everyone was expecting the Tariff to be reduced in April and it seems that most installers were budgeting on that.
Introducing the December change out of the blue would seem to have several major detrimental effects.
1) Some customers have signed a contract to have panels installed after christmas, will they be held to that although the figures have hugely changed.
2) Many companies will have programmed work in for the new year and will now have mass cancelations this must mean a lot of lay offs.
3) Would anyone trust any promises from the government about long term commitment to FITs and what effect would this have on the proposed RHI.
While I have serious reservations about the FIT just changing the rules mid term is disgraceful and will have a big impact on the renewables industry.
 

[Alan Clarke]

I'm afraid it did look like DECC used economists to work out FIT levels - so complete mess not hard to predict!

Looking ahead to the consultation, there seems to be a view that us in the energy efficiency camp might welcome the proposed link between FIT and efficiency measures. In fact I don't, it doesn't make a whole lot of sense to me.

Why? Does this mean policy is
a) only make houses with south facing roofs energy efficient
b) put PVs on roofs of any orientation so long as the house beneath can be easily/cheaply made efficient
 
What have either of these options got to do with efficient use of a PV subsidy - PVs are an expensive way of reducing carbon emissions, so if you must have them why not make them work as efficiently as possible (in a field in Cornwall?). If you actually want to reduce carbon emissions then just do the efficiency measures.
 
However...govt has a problem acknowledging this disconnect between PV and house efficiency, as the ZC 2016 regs are predicated on the idea that you can use PV to offset poor fabric if you feel like it - note that the carbon limits for ZC2016 are basically defined by how much roof is available for PVs per m2 floor area, so flats, which have good thermal efficiency have a lax target because they can't carry so much PV!

[neill lewis]

Firstly the petition is badly worded:  if you are going to sign something, make sure it is coherent.

Secondly,  the FITs system is another example of the poor subsidising the wealthy.  Those who have installed PV panels have done so because they can afford to and are claiming payments from all electricity users including the less-well-off in society.  The fuel-poor will never be able to afford to install PVs but will continue to subsidise those who can.  

Thirdly, the tariffs were set too high in the first instance and I understand that the new tariff is at a similar level to that paid in Germany.

While I sympathise with manufacturers and installers who have been shafted by this decision, it is for their trade bodies to take up their case, not AECB.
 
AECB cannot support this petition because it would imply support for FITs.

[Darren T Archer]

Thanks for your comments, I wasn't looking for the AECB to support the petition just making individual members aware of it.
While I appreciate your comments on the poor subsidising the rich, it is unfortunately the system we are stuck with, maybe you should consider where these statements are coming from before championing them.

The fact is under fit a householder can expect to see an increase of around a pound in their bills and this is because the government let the companies past the costs on rather than reduce their profits.

Secondly I'm sure mr abramovich and the despot sheiks in Saudi will be more than happy for your support of the current system, is this not the poor subsidising the super rich? While we continue to produce our energy from inefficient gas systems with the gas bought from these mega billionaires. But like I said the power companies are hardly going to flag this up as a way of promoting a potential rival.

Your right F.I.T is a very poor system and we should reduce energy usage before going down the route of eco bling. It just shows how little the people making the decisions know but it's what we are stuck with.

[Chris Lord-Smith]

As an installer you can imagine that I have an axe to grind.

I agree that the FiT system is a badly designed one, the rates were set far too high in the first place, there were no requirements for energy efficiency, and the whole system has attracted the worst of human nature - basically greed.  People who don’t give a damn about the environment have suddenly become green with the latest shiny toy on their roof, and they earn a packet to boot, and can drive about in their gas guzzling 4X4s and BMWs with impunity.

As installers of a range of technologies I have seen our clients going from people with basically a "green" agenda, to those whose only concern is how much can they make from it.  The whole market has been shifted to interest in PVs, to the detriment of other techs.

It used to be the set question, "What grant can I get?", now it is one of solely “how much can I earn?”  This has been exacerbated by many organisations such as the EST who even have an online calculator to get people drooling - showing how much they will earn from the FiT.

I think the government is right to reduce the rates.  People could spend around £11k on a system and earn a round £1,800 a year - not bad for an investment in this day and age, I will leave you to work out the percentage return on capital.  Then add to this the fact that it is indexed linked and guaranteed for 25 years. Not surprising the demand for PVs has gone through the roof.

When I fitted PVs to my roof 8 years ago (yes I did get a grant), I worked out that had I paid the full rate, it would take 80 years to pay for itself at the price of electricity then ignoring inflation – a non starter in anybodies book financially but that is not why I did it.

I believe the rate was set far too high in the first place, and with the increasing levels of demand, it was inevitable that it would become oversubscribed.  Not surprising then that the government has reacted like it has.  

Systems have come down in price by at least 30% since the FiT was introduced, there should have been a reduction in April 2011 of around 25% which was how much systems had come down by at that stage from when the scheme was first introduced.

Companies who up to now have had no interest in green issues have seen a golden opportunity to make money capitalising on a stupid system and human greed.  Yes there will be layoffs and liquidations, but who is to blame for that.  The old adage about “if something appears too good to be true it probably is” should have been applied when companies built their business plans.  I do feel sorry though for people who thought they had got a job for life probably facing redundancies, the first round of which has already been implemented by some companies.

As a company we have been here before, with the fiasco that was the Low Carbon Building Program, and seen our business go from boom to bust to boom to bust to now a PV boom.  We were expecting a significant reduction in turnover following a review in March, but I built that into my plans, just as well my plans are extremely flexible given the current situation.

I guess the real issue here is not that the FiT has been reduced, but the way that the reduction has been managed.  How can they launch a consultation period which ends on the 23rd December and then in the same statement reduce the rates by 50% from the 12th Dec.  The results of the consultation period will not be known until February next year.  It is on this basis that many challenges both legal and in the House and EU Commission will be mounted.

For those of a purely mercenary nature PVs will continue to be a good investment.  I predict that to keep their order books going, prices will be reduced by installers to around £10k for a 4 kW system, which has the potential to earn £900 a year.  In my view still not a bad investment in this day and age.

So we have a situation, get over it, stop moaning and lets work out how we can achieve a more sustainable future.

If you want to add your name to a petition there is one at http://epetitions.direct.gov.uk/petitions/20912 which at least is better worded than the one already mentioned above.  Don’t know what effect it will have but there we go.

Just dont get me started on the Renewable heat incentive that is all I ask

Oh well that’s my rant over.  Time to get on with life.