| 20 May |
Incentive For Solar (13)-Feed-In-Tariffs-UK |
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Now, let’s take a look at a country, UK, that had implemented Feed-In-Tariffs more recently, in addition to its renewable energy quota scheme (ROCS). The UK Secretary of State for Energy and Climate Change, Ed Miliband presented details of the scheme for Feed-In-Tariffs in the United Kingdom back in July of 2009 and UK’s FIT began in April of 2010. Below you will find the specifics of UK’s FIT listed in Wikipedia:
The Feed-In Tariff applies to small-scale generation of electricity, paying a fixed sum for eligible technologies. Payments through the mechanism are intended to replace the ROCs available through the Renewables Obligation for small-scale renewable energy generators and is based on a few key elements:
- The tariff is available only to renewable sources producing up to 5 MW power. Specific rates are set for different technologies and at different scales of installation for those technologies. Generators of renewable electricity larger than 5MW remain eligible to earn Renewables Obligation Certificates within the existing Renewables Obligation quota mechanism. To prevent companies from moving large scale (for example big wind) projects from the ROCs to the Feed-in Tariff programme, a number of anti-gaming provisions has been inserted in the policy design; this should avoid the breaking up of bigger projects into several small ones, to fit within the 5 MW energy size cap.
- The contract term is 20 years, 25 years for solar photovoltaic projects: this means that, starting from 2010, British providers of Wind Energy, Hydropower, Energy from Biomass and Anaerobic Digestion eligible for the FiT scheme will be rewarded with a tariff rate guaranteed for the next 20 years – 25 years for Solar PV generators.
- The tariff made available to generators will be subject to digression. That is, the tariff level available for new generators will decrease annually. the rate of digression will vary by renewable energy technology. The price for individual renewable energy generating plants is fixed once the plant becomes operational.
- Costs for the programme will be borne by all British electricity consumers proportionally: all consumers will bear a slight increase in their annual bill, thus allowing electricity utilities to buy renewable energy generated from green sources at above-market rates set by the government.
- The new UK’s Feed-in Tariff Programme review is scheduled for 2013.
- When the government review the current Feed-in Tariff in 2012/2013 they are expected to reduce the amount paid out by around 15% and continue to reduce it every 2 years.
The UK FiT design has a few distinguishing aspects: One new feature is the inclusion of tariffs for Combined Heat and Power (CHP), which only a few other systems provide for. Another is the provision of two distinct tariffs, one for small solar photovoltaic installations on new houses and the other for existing homes.
The government estimated that feed-in tariffs to support small-scale low-carbon generation would cost £8.6 billion up to 2030 and produce monetized carbon savings worth £0.42 billion
University of London has assessed the first year of UK’s FIT scheme through interviews with users of the FIT and government figures. The study suggests that technologies have a variety of factors affecting their performance in terms of installation levels, such as cost, size, availability, standardization of the technology, planning issues, ease of installation, perceived sensory impact (sight, sound and smell) and administrative complexity. Domestic PV scores very positively on all these factors, while small hydro and AD do far less well.
In March of 2011 the new coalition Government announced that support for large-scale PV installations (greater than 50 kW) would be cut. The proposed changes to the tariff levels for PV have been met with anger by many in the solar industry, but the FIT policy, along with the Green Investment Bank and now carbon reduction targets, are widely understood to be threatened by the Treasury department. This is due to the schemes being considered as liabilities on the UK national balance sheet. In this next clip at http://www.youtube.com/watch?v=it6TTFllaPQ&NR=1 you will see/hear interviews with users of UK’s FIT scheme and more detailed explanations of UK’s FIT.
Posted by sunisthefuture-Susan Sun Nunamaker, sunisthefuture@gmail.com
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