Government consults on short term cuts but offers no long term vision on people power
27 August 2015
The UK Government today announced changes to the Feed-In Tariff (FiT) programme which supports small scale renewables. Many thousands of householders, farms and rural businesses have benefited from this scheme, with 10% of UK farms now using wind energy to reduce energy costs.
The UK Government is reducing support across technologies and setting a cap on the number of schemes supported each quarter. But these limits will be hard to understand in advance, so increase the risk for anyone applying for support. RenewableUK is warning that complex rules would in the long term scare away many of the people who could most benefit from this scheme, and in the short term create market chaos.
The programme is designed to promote small-scale renewables through ensuring householders, communities or businesses are paid a set tariff by electricity suppliers for the power their projects generate. This flagship support mechanism has been a lifeline to these farmers, as well as householders, rural businesses and community groups wanting to cut energy costs and play their part in cutting carbon emission.
The market has been supplied mainly by UK turbine manufacturers who supply both the UK and export markets. For every turbine sold at home, one is exported. A strong domestic market is vital for these companies, but further shrinking of this market will hurt UK manufacturing and encourage relocation abroad.
RenewableUK’s Deputy Chief Executive, Maf Smith, said: “It’s important that we all work to manage costs, but it looks as if the long term vision has been lost.
The small and medium wind sectors are at one with Government in their desire to cut carbon at lowest cost to the consumer. But they can’t do this when Government makes sudden and damaging changes which undermine investment.
What we needed in this Review was a clear vision for how we get to a point where cost effective, small-scale renewables are common-place, with all homes and businesses able to be part of a productive, vibrant low carbon economy. This Review is not about how we build that prosperous future but simply about short term politics and accounting.”
RenewableUK is also expressing concern about the speed at which Government is making these changes. Maf Smith continued: “We’re also concerned about the timing of this review. Only last month Government consulted on ending pre-accreditation. Now they are consulting on reducing tariff rates, and capping deployment. But such significant changes can’t be introduced within the proposed January 2016 deadline without hurting many businesses and individuals who have been investing in new projects. The next four months will turn the British energy market into a wild-west market with energy consumers stuck in the middle.”
- At the end of 2014, small and medium wind turbine installations had a total generating capacity of 248MW.
- Up to now, the Feed-in Tariff has helped create a flourishing market for smaller wind turbines across the country, which has often provided a lifeline to the rural economy. The past year alone saw the UK’s small and medium wind industry generate £174 million to the economy.
- An estimated 1,800 people are directly employed in the industry and this announcement puts those jobs at risk. Government’s own figures show that changes introduced in the last two years have already brought significant reductions to small and medium wind, for example reducing deployment of small wind turbines by 80%. These new changes will reduce this even further with up to 20,000 less installations.
- More on the Feed-In Tariff scheme can be found here: https://www.ofgem.gov.uk/sites/default/files/docs/2015/02/fitfactsheet_0.pdf