The government has confirmed that it will introduce a new Renewables Obligation Certificate (ROC) banding specifically for medium-sized roof-mounted solar systems.
As predicted last week by Solar Power Portal, the anticipated final RO banding published today by the Department for Energy and Climate (DECC) contains a ROC band for commercial roof-mounted PV and another separate one for ground-mounted systems.
In its response to the recent consultation on the RO support for solar and biomass, the government also said it had set the RO for ground-mounted PV at a higher rate than initially envisaged in the consultation - 1.6 rather than 1.5/MWh. However, it fell short of the 1.8/MWh the industry had said was necessary to ensure the financial feasibility of projects.
The banding for the new rooftop RO will be set at a higher rate than the ground-mounted PV RO category and is designed to stimulate investment in solar systems on large factory or warehouse buildings.
It will start at 1.7/MWh when it comes into effect next year and fall incrementally by 0.1.MWh each year until 2017, when ROCs will be replaced with the contracts for difference outlined in the Energy Bill.
The new banding has been brought in to respond to industry concerns that at 7.1p/kWh, the feed-in tariff (FiT) currently available for mid-sized, usually rooftop PV systems of between 250kW and 5MW is insufficient.
Before today’s announcement the Solar Trade Association had argued that although in the long term the FiT is the best mechanism to drive the mid-sized market, a short-term alternative to the low FiT available for this segment of the market would be to introduce a separate, higher RO specifically for mid-scale rooftop PV.
DECC said that in setting the RO bands, it had decided to move away from the so-called FiTs equivalency policy, meaning the support levels for PV under the RO will be set separately from the FiTs scheme.
The separate RO banding for ground-mounted PV will be set at 1.6 next year then fall each year thereafter to 2017 to 1.4, 1.3 and 1.2 respectively.
Solar Power Portal will bring full industry reaction to the announcement later today.