Japan may announce preferential price rates this month for electricity generated from renewable energy in a program that will start in July to encourage investment in non-fossil fuel power plants.

A five-person panel have been discussing the preferential rates, known as feed-in tariffs, since March 6 and will hold their sixth meeting on April 25.

Japan’s Ministry of Economy, Trade and Industry hopes to receive the recommended rates by April 27, which will then need government approval, Keisuke Murakami, who heads clean energy programs at the ministry, said today.

The feed-in tariff guarantees above-market rates for solar, wind, geothermal, biomass and hydroelectric power. The Japan Photovoltaic Energy Association proposed 42 yen (52 cents) a kilowatt-hour for 20 years for solar power. For wind, the Japan Wind Power Association suggested as much as 25 yen a kilowatt- hour for the same period.

Murakami said no decision had been made about rates for solar power in response to a Nikkei newspaper report today that said the rate will be 42 yen a kilowatt-hour for about 20 years. The newspaper didn’t state the source of its information.

By : Bloomberg

When connecting a solar power system to the grid, the application process involves submission of a form to the relevant Distribution Network Operator (DNO). Which form and when are two important matters covered in this article.

Read the full article here

Registering Solar Generators with the DNO

Depending on who you ask these days, different sized systems require different application forms be sent to the DNO. The general expectation is that the larger a system, the more preemptive information is required to be transferred. Let’s look at the two main forms that will affect systems of 4kWp and smaller.

Small Scale Generator and the G83

Systems deemed to be under 16 amps per phase are considered ‘small scale’. They can be installed straight away and registered by submitting a G83 form to the DNO following the installation. EON has a copy of their G83 form here for download.

In order to establish if your generator is under 16 amps per phase, it is best to consult with your solar installer. The correctly trained electrical staff they have on hand will be able to assist. As a rule of thumb, systems under 3.6kWp will be under the 16 amps limit the vast majority of the time. However, seeing as the feed-in tariff changes after 4kWp this presents a grey area for installations between 3.6kWp and 4kWp.

Large Generation and the G59

For generators over 16 amps per phase it is a legal requirement for the DNO to be consulted prior to an installation taking place. In addition, a G59 form (download here) is required to be submitted. The process of a DNO reviewing and returning a successful G59 can take up to 8 weeks.

Obviously the important aspect of this process is establishing the amp levels of the proposed solar power installation with the installer’s electrician. The tilt, orientation and location of a solar generator can affect the amps, so it is vital that anyone installing systems from 3.6kWp upwards establishes the correct process for registering their system. This is especially the case with the deadlines of April 1st and July 1st 2012.

Written by Jarrah Harburn

Next week’s Budget is likely to deal a further blow to Government promises to create jobs and tackle soaring fuel bills by building a clean economy and safeguarding our environment, Friends of the Earth warned today (Friday 16 March 2012).

The environment charity is urging the Prime Minister, who promised to lead the “greenest Government ever”, to ensure George Osborne keeps his pre-election pledge for “the Conservative Treasury to be in the lead of developing the low carbon economy and financing a green recovery”.

There are growing concerns that next week’s Budget will lead to:

• Little action on developing a clean, low-carbon economy
o The UK’s dependency on expensive fossil fuel imports has led to rocketing fuel bills. Developing the UK’s vast wind, wave and solar potential would create thousands of jobs and boost our energy security. But George Osborne has shown little enthusiasm for getting the UK off the fossil fuel hook – and recently inaccurately claimed that moves to boost a clean economy are responsible for driving up energy bills.

• A reduction in safeguards for wildlife and the countryside
o The results of Government reviews of planning and environmental regulations are expected to be announced alongside the Budget. This could pave the way for more building in the countryside and less protection for our wildlife. George Osborne recently told MPs he wanted to make sure that “gold plating of EU rules on things like habitats” were not putting “ridiculous costs” on firms – despite little, if any, evidence to back up this claim.

Friends of the Earth’s Policy and Campaigns Director Craig Bennett said:

“In opposition the Chancellor pledged to lead the fight to create new jobs and tackle soaring fuel bills – and keeping his promise to develop a clean future is the best way to fix our broken economy.

“We must free ourselves from the shackles of our reliance on costly fossil fuels by switching to clean British energy, which is the only way to give us affordable power in the long term.

“David Cameron’s silence on this issue is deafening – he must remind his Chancellor that the best way to build a strong economy is to build a clean economy.”

Responding to George Osborne’s stated intention to “make sure that gold plating of EU rules on things like Habitats aren’t placing ridiculous costs on British businesses”, Craig Bennett added:

“There are many reasons why the economy is struggling, but measures to protect our precious wildlife sites are not one of them.”

Click here to read the full article

With two significant reductions in the feed-in tariffs for commercial systems taking place within the last twelve months, it’s understandable that the UK industry is taking stock of what has occurred. It’s obvious now that the government incentives introduced for commercial solar power were too generous to sustain. It’s also becoming increasingly evident that the Department of Energy and Climate Change(DECC)  will use its power to swiftly alter government incentives when they deem necessary. What needs to be contemplated forwards from this is that with an experienced and industry conscious awareness commercial solar power can still establish viability in the UK. This article will explain why.

Utilising the economies of scale and potentially significant savings that companies and business owners can make on their energy usage, the commercial market holds a great deal of potential for investors. There are nuances to consider however, and the handling of the feed-in tariff incentives by the UK Government has not added to the security of the prospect for many people. This does not mean that potential projects have become more risk than their worth, it simply means that project management must protect investments using the lessons of the past and innovations of the future to minimise risk and maximise gain. Sound like a familiar set of circumstances for most kinds of investment? It is, so let’s analyse this in greater detail.

The Current State of Commercial Solar Incentives

Feed-in Tariffs

All information provided in this article is based on the proposed changes to the feed-in tariff, outlined on the DECC website here.

There are two purely financial benefits that arise from the feed-in tariffs.

1. The ‘Generation Tariff’ is paid for every kWh generated by an eligible system whether it is used on site or exported to the grid. The proposed new rates are:

• Tariff for >4-10kW PV installs = 16.8p/kWh (in year one*)
• Tariff for >10-50kW PV installs = 15.2p/kWh*
• Tariff for >50kW – 150kW = 12.9p/kWh*
• Tariff for >150kW – 250kW = 12.9p/kWh*
• Tariff for >250kW – 5MW = 8.5p/kWh*

*This rate will only apply for the first year of the systems operation. It will then increase based on the Retail Price Index’s (RPI) inflation over it’s 25 year lifespan.

2. The second aspect is the ‘Export tariff’, and this remains unchanged from the DECC proposals. It is a flat rate of 3 pence per kWh generated from an eligible system, unused on site and sent onto the grid.

Energy Savings

The third benefit that comes directly from generating solar energy from a system concerns the energy usage and bills on site. Earnings can be significant, and are established when property owners compare the new tariff rates with current bills. The rise of energy prices make this aspect of clear benefit, and just as importantly more effective the sooner the installation is carried out.

The ‘Energy Bill Savings’ are calculations on what the cost would have been to buy a kWh from the grid when it is instead generated from the solar power system and used on site. More complicated to calculate because it relies upon an analysis of the tariff times and rates of the properties energy bills, a Solar Selections Commercial Broker is trained to assist customers with establishing these figures and their influence on rates of return.

There are also a number of environmental, corporate image and sustainability benefits that are associated. Solar Selections Commercial designs projects that take into account these goals and provides suggestions for how to maximise their impact on the installation. It’s case specific, and again best discussed with your project managing broker.

Primary Areas of Development and Potential

Finance

The reality of many investment opportunities is that they are often capitalised upon during unexpected times. So long as the commodity in question is deemed to be a) increasing in value, b) possessive of a rare quality and c) stable, investment will find it and want to share in the profits. Commercial solar power is an investment in renewable energy, and all three aspects are most definitely upheld by this commodity. Renewable energy is considered a viable investment in the world today, and this is upheld despite the tariff changes in the UK.

For these reasons, private investment is expected to come into focus for the commercial market here moving into 2012. Through conglomerates and syndicates lines of capital are being opened up across the UK for these projects, through firms such as Solar Selections. These lines of capital will come into play as soon as the appropriate figures regarding returns on investment are established. So let’s look at some ideas on how this can happen.

Suggestions

First of all, the price per watt of solar components needs to continue to be driven down. In the UK we have excellent prices considering our almost complete lack of onshore manufacturing and assembly plants, but more can be done. One stigma that immediately needs to be overcome is the focus towards brand name solar products, especially on panels. Distributors and importers alike need to develop more robust relationships with the largest manufacturers in the world such as Suntech, Trina, JA Solar, Yingli and First Solar and educate their customers on the technical differences and advantages on these modules. Moreover, the public need to be educated on the differences between panel brands in a more objective manner.

Secondly, finance when sourced for large scale solar installations needs to become more comprehensively advantageous to business. Zero upfront capital outlay, tax benefits and perpetually positive cash flow positions are a small number of unique approaches as yet unexplored by the mainstream finance market; see our full article for further details. Solar Selections Commercial is in the process of introducing an exclusive package currently operating in our other countries for our clients that addresses these points and many more benefits. We encourage interested parties to contact our commercial management team for further information.

Finally, there are the more generalised energy efficiency and sustainability overhaul approaches to commercial properties that are to be more widely and professionally used. This involves considering a complete energy efficiency upgrade plan for a property with solar energy merely one aspect among a wide range of implementations to be considered. By way of example this may include installing energy efficient/motion activated lighting and monitors, condensing CPU and modem hardware into micro-managed energy efficient hardware and software, advanced telecommunication and video link software to curb travel and conference logistic costs and simpler measures such as anti-draft stoppers under doors or power point energy savers. Considering the DECC’s proposals regarding implementation of Environmental Performance Certificates (EPC) into eligibility for the solar feed-in tariffs, such practices may indeed become necessary for solar projects with the coming of 2012.

EPC’s are essentially a summary of a property’s energy efficiency and carbon dioxide emissions. They are used as ratings for all properties bought, sold or rented in the UK. The DECC’s suggestions have centred around only allowing properties with certain minimum EPC ratings to be eligible for solar FiT’s, effectively closing off the tariffs to properties judged too inefficient.

Once again, Solar Selections will be at the forefront of this approach offering options from our network of energy management consultancy firms to our clients that comprehensively address energy efficiency and emission standards.

Conclusion

A midst the controversy and decisive nature of the UK government’s cuts to the solar feed-in tariffs last year, the truth of the matter is that it has been the most successful 12 months in the solar industry’s history. The Commercial solar industry has experienced only a glimpse of it’s true potential, and whilst it is hard for some installers and potential investors to see right now, the sector has its best years ahead of it. By developing and utilising proven approaches to aspects such as finance, energy use reduction and energy efficiency, feasibility will be re-established and become accessible to many thousands of business owners and investors. The international examples are there for all to see, and with the exciting development of prospects such as our Operational Lease arrangement, Solar Selections will be at the helm of the budding commercial solar industry of 2012 and beyond.

Written by Jarrah Harburn

jarrah@solarselections.co.uk

T: 0844 567 9835