No February feed-in tariff cuts as rates remain the same until 1 May 2013

Ofgem has confirmed the feed-in tariff (FiT) rates for solar photovoltaic technology beginning February 1, 2013. The rates will remain the same, as reported by Solar Power Portal last month, following disappointing levels of installs across all capacity bands.

The new FiT rates, as of 1 February, 2013, will be as follows:

Description

FiT rate p/kWh

0-4kW

15.44

>4-10kW

13.99

>10-50kW

13.03

>50-100kW

11.50

>100-150kW

11.50

>150-250kW

11.00

>250kW-5MW

7.10

Stand-alone

7.10

Export tariff

4.50

The Department of Energy and Climate Change has announced that the deployment of solar photovoltaic installations for the period 1 August to 31 November was as follows:

 Installations with declared net capacity of:

Aggregate capacity deployed in period (kW)

>0–10kW

61,048

>10–50kW

12,563

>50kW and stand-alone

24,657

 

The lacklustre performance of the entire solar industry has begun to seriously concern industry insiders who have called on DECC to step in. The most notable section of the market that is severely struggling is the >250kW-5MW band.

A FiT rate of 7.1p has led to almost no investments being made in the capacity band and was branded as “incorrect” by the Solar Trade Association’s PV Specialist, Ray Noble. Industry insiders are concerned that the Department of Energy and Climate Change (DECC) is damaging a very important market with the overly-restrictive FiT rate – namely, the large-scale commercial rooftop market.

The February reference date falls 6 months after the introduction of the degression model. Since the new model was introduced, the solar industry in the market has experienced a significant depression of demand. Hence, two of the three reference dates have seen the majority of rates receive no degression at all.

A major criticism levelled at the tri-monthly degression model when it was introduced was that it failed to introduce any method to readdress the FiT levels if installation rates flat lined – like the 250kW-5MW market is currently.  

Indeed, even though there has been extremely low deployment in the tariff band, on 1 May the rate will be cut by a further 3.5% regardless of the sector’s performance. A FiT rate of 6.85p for 250kW-5MW projects will see almost all new projects installed within that band elect to receive support under the Renewable Obligation (RO). However, industry is still waiting for DECC to release the banding rate after consulting on a rate of 1.5ROCs.

What are your thoughts on the degression model and the FiT rates as of February 2013? Let us know in the comments below.