‘Green’ power installations will see changes in FIT subsidies

From August of this year, solar-power installations will see a marked reduction in feed-in-tariff (FIT) subsidies, while energy-from-waste plants that use anaerobic digestion will see a small increase.

It comes after a lengthy consultation period on FIT pricing brought about by government concerns over the affordability of subsidising large-scale solar installations.

As of the beginning of August, installations of solar power that have between 50 and 150kW of total capacity will receive 19 pence per kilowatt-hour produced, down from 32.9 pence. Larger installations of up to 250kW will receive a reduced tariff of 15p/kWh and installations of between 250kW and 5MW of capacity will get 8.5p/kWh. Both larger sizes were previously paid 30.7p/kWh. Solar schemes of less than 50kW were unaffected by the review.

Meanwhile, AD facilities up to 250kW will receive 14p/kWh and those between 250 and 500kW, 13p/kWh — while some AD plants will also be eligible for the renewable heat incentive (RHC) subsidies, which are separate from the FIT scheme. Previously AD plants up to 500kW got 11.5p/kWh, with plants larger than this getting 9p/kWh.

The Department of Energy and Climate Change (DECC) said that, under the previous pricing bands, every 5MW large-scale solar scheme would incur a cost of approximately £1.3m per year — meaning that 20 such schemes would incur an annual cost of around £26m. This could otherwise support solar installations for more than 25,000 households, it points out. 

‘Without action, the scheme would be overwhelmed. The new tariffs will ensure a sustained growth path for the solar industry, while protecting the money for householders, small businesses and communities, and will also further encourage the uptake of green electricity from anaerobic digestion,’ said climate minister Greg Barker.

However, solar-industry experts have criticised the announcements, saying that large-scale schemes — many of which were planned for areas in the south west — are more efficient than domestic-size systems.

Howard Johns, chairman of the Solar Trade Association, said: ‘Crushing solar makes zero economic sense for UK PLCs because it will lose us major manufacturing opportunities, jobs and global competitiveness. It also risks locking us into more expensive energy options in the future.’