Feed-in tariff solar deployment continues to falter under new rates

  • Solar.

    Deployment has continued to falter three weeks into the new regime. Image: Abundance.

The deployment of feed-in tariff accredited solar installations has continued to struggle three weeks into the new regime.

New feed-in tariff rates of 4.39p/kWh for installations up to 10kW in size came into effect on 8 February 2016, a reduction of almost two-thirds on the previous rates of 12.01p.

The first quarterly cap for the period running 8 February to 31 March allows for 48.4MW of solar to be installed under the domestic deployment band, but to date just 7.6MW has been accounted for.

When the new cap opened, 3.8MW was immediately registered covering installations made during DECC’s pause of the regime from 15 January. Since then an average of 1.9MW has been installed each week.

This is substantially down on deployment figures from last year. Statistics recently released by DECC demonstrated that MCS accredited installations up to 10kW in size amounted to 30.2MW in February 2015.

With five weeks until the quarter closes just 16% of the cap’s capacity has been utilised. A rough extrapolation of current deployment rates would mean that around 17.1MW of solar would be deployed under the current cap, leaving some 31.3MW of capacity spare.

Under DECC’s capping and queuing system, that capacity would be rolled over and added to Q2. If deployment continues at the current rate, it would result in a Q2 cap of more than 80MW.

Other deployment bands are however seeing stronger demand. The standalone band cap was breached just one hour into the new regime and large commercial rooftops in excess of 50kW in size have deployed just under half of the Q1 cap.

There is also a belief among installers that the industry will rebound slightly once it gathers momentum following the initial effects of the cuts. Some installers have reported seeing a large number of enquiries in recent weeks in spite of the reduced rates being widely publicised.

David Pickup, business analyst at the Solar Trade Association, said that it was still early days within the new regime.

“It will take a few months while the market recalibrates to uncover the trends. For the larger rooftop and standalone systems, pre-accreditation is counted against the caps so these projects won’t be built for some time. We are continuing to push Ofgem and DECC to make sure the new feed-in tariff regime is run as transparently and efficiently as possible,” he said.

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