The early review of the UK solar feed-in tariff has caused consternation within the industry, still in its infancy and reliant on the tariff for log term viability. Chris Huhne, Secretary of the Department of Energy and Climate Change made the announcement this week that the FIT would be reviewed in light of the “threat” to the scheme posed by large scale solar projects which have begun to take advantage of the scheme. This combined with the recent spending review which will make it necessary to cut 10 per cent from the tariff rates.
The feed-in tariff was introduced as a means of attracting investment in solar energy and greatly increasing uptake in solar pv panels in the UK. The tariff works by offering guaranteed, premium rates for units of energy both consumed and fed back into the grid for small scale renewable energy producers. This tariff has been very successful at attracting investors and manufacturers alike, all keen to tap into the revenue which can be generated from the feed-in tariff. However, Huhne believes that the feed-in tariff has perhaps been too attractive with a number of large solar farms developing under the system. The DECC secretary stated,
“Since the Spending Review, I have become increasingly concerned about the prospect of large scale solar PV projects under FITs, which . . . could, if left unchecked, take a disproportionate amount of available funding or even break the cap on total funding,”
Solar Trade Association spokesman, Howard Johns lamented this news saying,
This is really bad news for the solar industry in the UK. Last week Ministers welcomed the study showing that 17,000 jobs would be created by the industry in 2011. This week has seen them once again changing the goal posts and threatening investment and jobs in the sector.”