The government will tomorrow publish the long-awaited levels of remuneration it will offer for renewable energy generated by households and communities and fed back into the national grid.
It hopes the new tariff will boost the growth of “micro-generation” by small-scale wind turbines, solar panels or hydro power. But there are fears in the renewable energy industry that the Department of Energy and Climate Change will make little or no upward adjustment to the tariff levels for clean electricity it proposed last year.
The DECC has been heavily lobbied by the big energy firms, and tomorrow's announcement has been delayed several times. The Clean Energy Cashback, or feed-in tariff, will reward households, businesses or communities by paying above-market rates for the electricity they produce and feed into the grid.
When the tariffs were unveiled last year, they were criticised for offering rates of return too low to encourage people to install micro-generation plants. Germany introduced feed-in tariffs a decade ago offering double-digit rates of return and sparked a green revolution.
But Alan Simpson, special adviser to energy and climate change secretary Ed Miliband, fears the battle to get higher tariffs has been lost and believes the DECC will stick to its aim of getting just 2% of the UK's electricity from smaller scale renewables by 2020. He says three times that would be easily achievable at an additional cost per household energy bill of £1.20 a year.