All change: feed-in tariff alterations take effect from April 1

As I’m sure most of you are painfully aware, the Department of Energy and Climate Change (DECC) is introducing a range of changes to the feed-in tariff scheme as of April 1, 2012. 

In just two days’ time, the feed-in tariff rates for all systems up to 250kW installed after March 3, 2012 will drop, while a lower multi-installation tariff is introduced and energy performance guidelines are put in place.

Commenting on these alterations, Energy and Climate Change Minister, Greg Barker said: “These changes will help improve the feed-in tariffs scheme, ensuring it is a scheme for the many and not for the few.  I am currently looking at how it can be further improved to offer certainty for householders, communities and industry and would welcome thoughts on our proposals.

“I want to see a bright and vibrant future for small scale renewables in the UK and allow each of the technologies to reach their potential where they can get to a point where they can stand on their own two feet without the need for subsidy sooner rather than later.”

The table below outlines the new tariffs for solar installations as of April 1, 2012, including the reduced rate for projects where solar is installed over more than 25 sites. These rates do not include the annual RPI increase.

The new multi-installation tariff rates mean that a single or individual organisation that is already receiving FiTs for 25 or more other solar PV installations will receive 80 percent of the standard tariffs from April 1. DECC argues that this reflects the lower costs these installations experience through economies of scale, however, due to administration costs and the levelling out of PV component prices, this is not necessarily the case. All organisations installing less than 25 systems will continue to receive the full FiT rate.

Also from April 1 this year, all buildings looking to install solar PV will have to gain at an Energy Performance Certificate (EPC) of at least level D in order to benefit from the higher feed-in tariff rates. All systems that do not reach a level D will receive 9p/kWh.

Any building that is not suitable for an EPC assessment, or an installation of more than 250kW will be exempt from this requirement.

The good news here is that the solar installation will count towards the EPC rating. This means that the customer has the opportunity to apply for feed-in tariffs after the installation has been completed. It is estimated that around half of all properties are already eligible for a D rating.

Government is currently consulting on a range of alterations to the feed-in tariff scheme, including reducing the tariffs for solar over time to reflect market trends and uptake. It is also consulting on the treatment of social housing and community schemes, to decide whether they will also be affected by the multi-installation tariff reductions.