DECC have announced that FIT rates for systems <50kW will be subject to a 3.5% cut.
Despite this a 4kW solar pv system can still offer rates of return in excess of 10%!
The new rates are listed below. If you want to beat the 1st November deadline get in touch quick on 0344 567 9032 for your free 10 minute solar survey.
DECC have today announced their response to the much maligned FIT consultation (phase) which closed on 23rd December 2011.
Here are the headline changes and time frame for them to come into effect (click here for full details):
New FIT rates for PV – coming into effect from the 3rd March 2012
To be eligible you must have had your installation completed and FIT application form and supporting documents received by your chosen energy supplier by the 3rd March.
Minimum Building Energy Efficiency rating – coming into effect 1st April 2012
Solar panels installed on or after April 1, 2012 will be required to produce an Energy Performance Certificate rating of D or above to qualify for the full FIT level. The tariff for a building is rated below ‘D’ will be 9p/kWh for the lifetime of the tariff, which means energy efficiency measures will have to be completed ahead, or on day, of your PV installation.
DECC estimates that about half of all properties are already eligible for a ‘D’ rating. Below are DECCs estimated costs for upgrading energy efficiency:
- £1280 for a detached house with cavity walls currently rated as F where loft insulation, cavity wall insulation, heating controls and hot water cylinder insulation would be needed;
- £530 for a mid-terrace house currently rated as E that already has loft insulation, but where cavity wall insulation and hot water cylinder insulation are needed.
The typical cost of obtaining an Energy Performance Certificate (EPC) is £50-100 (please contact us for a quote) and will require the visit of an energy assessor to inspect your property. The whole process will take 5-7 days to complete and upload to the central register.
Multiple installation tariff rates – coming into effect 1st April 2012
Defined as installations owned by any individual or organisation a tariff level of 80 percent of the standard tariff, to reflect the lower costs that such installations benefit from.
As a response to feedback, DECC has changed the threshold for the lower tariff from more than one, to more than 25 installations operated by an individual or organistation. However, DECC is consulting on a proposal that would allow social housing, community projects and distributed energy schemes to be exempt from the reduced multi-installation tariff rates.
FIT degression – reviewed every 6 months or when deployment threshold reached
DECC’s proposed mechanism for changing tariffs after July 2012 will include an automatic baseline transgression of 10 percent every six months, which can be triggered early if deployment exceeds ‘pre-determined’ levels. The system will be reviewed annually to ensure that it is performing well against its objective.
Further cuts on 1st July 2012??
DECC is also proposing that solar FIT tariff levels should reduce from July 1, 2012. The rates for July will be 13.6p or 16.5p depending on the volume of deployment of PV in March and April 2012. Given the panic this is likely to induce we would predict the lower 13.6p rate coming into effect which constitutes another draconian 35% cut in the standard tariff rate.
What if I install a system pre-3rd March?
DECC still intends to pursue its appeal to the Supreme Court, which if they win will mean they reserve the right to apply new rates (see above) to all installations completed between 12th Dec 2011 and 3rd March 2012.
This still leaves installers, and consumers, in the position that we cannot guarantee the rate you will receive if we complete your installaiton within the interim period.
We are therefore continuing with our offer where:
- We will price your system based on the new standard rate of 21p/kWh
- If the figures still work for you at 21p, you place your order
- We will guarantee that your installation is completed, and FIT application paperwork is submitted to your energy provider, by the 3rd March
- If the government then lose their appeal to the Supreme Court you will be best placed to receive the pre-12th Dec standard rate of 43.3p for 25 years (although we cannot guarantee this rate)
Judges reject government’s appeal but ministers could still go to Supreme Court
The government may consider an appeal in order to ensure demand for new solar installations remains low in the run up to March 3 – the new cut off date for the higher rate of feed-in tariff incentives.
If the government does not appeal against today’s court ruling the level of incentives available for installations completed before March 3 will be confirmed at 43p/kWh. Ministers are concerned that the ruling could spark a month long gold rush as households and businesses rush to take advantage of the higher rate, eating further into a feed-in tariff budget that has already been exceeded for this year.
We will provide more updates over the coming days, however please do not hesitate to call us on 0344 567 9032 if you have any questions/concerns.
The Court of Appeal has upheld a High Court ruling that Government cuts to the Feed-in Tariff were unlawful. The three Lords Justices of Appeal announced their reserved judgement this morning following a hearing 10 days ago.
Today’s decision is a damaging blow to Ministers and officials at the Department of Energy and Climate Change, who must now introduce the contingency date of March 3 for the start of the 21p rate for solar PV and not the original December 12 deadline.
What does this mean?
The court judgement also means customers who have had solar panels installed and are registered ahead of the new March 3 cut-off point will now receive the original 43p rate for 25 years. Therefore, the industry has another 5 week period to install at the higher rate of 43.3p.
Customers who register on or after March 3 will qualify for the current higher rate until April 1, when it will drop to 21p.
Dave Houston, MD of Chester based PV FIT Ltd, said: “We welcome the news of tariffs reverting to 43.3p until March 3rd, although this puts us in an even tighter position to deliver solar projects than before Christmas”.
“We will be operating on a first come first served basis in order to ensure customers who proceed with us have their paperwork completed and returned to the energy companies before the March deadline”.
It’s very simple to get a PV FIT quote over the phone by calling 0344 567 9032, or via our website survey request. It only takes 20 minutes and you will receive a quotation by email the same day!
As we explained in our article on the 11th Jan, it has been nigh on impossible to determine what the current FIT rates are, which has dented consumer confidence.
DECC has now said that following confirmation that there will be a hearing of its appeal against the JR finding it can now state the following regarding tariffs – which should help to reduce the uncertainty:
“The tariff rate for PV installations less than or equal to 4kW will not fall below 21p for installations with an eligibility date between 12th December 2011 and 31st March 2012.”
21p/kWh means a 4kW system on a South facing roof currently offers a 10% rate of return – that is until 31st March when FIT rates could reduce further, and home energy rating of level C or above may be introduced.
To get a quote call us today on 0344 567 9032, and beat the rush!
The DECC Judicial Review for FIT Tariff Rates – A step-by-step guide to what happens now?…
As the date for the consultation review of the ‘FIT’s review’ looms, there is uncertainty in the industry due to the current situation.
An overview of the situation;
12th December 2011: eligibility date after which consultation proposes new installations should revert to 21p tariff on 1st April 2012
21st December 2011: Friends of the Earth, HomeSun and Solarcentury win their case against the Government’s proposed changes to the solar FITs
22nd December 2011: Joint Select Committee Report into FITs is published, criticising management of the scheme and the recent consultation process
23rd December 2011: Deadline for responses to consultation on Phase 1 of the Comprehensive FITs Review
4th January 2012: DECC announces that they have lodged grounds of appeal with the Court of Appeal
6th January 2012: Date for DECC’s application for permission to appeal announced
10th January 2012: DECC announced a further £197M for the small scale FIT budget
The Judge ruled that the 12th December reference date for the proposed cuts to the FIT, occurring two weeks before the consultation officially ended on 23rd December, would be illegal.
DECC released a statement on the 5th January regarding their request for permission to appeal and their comments on the High Court’s decision to reduce the FIT tariff rate:
“We disagree with this for a number of reasons. The overriding aim of the proposed reduction in tariffs for solar PV is to ensure that over the long term as many people as possible are encouraged to install small scale low-carbon generation (including other technologies as well as solar PV) and benefit from the funding available for the FIT scheme.
Without an urgent reduction in the current tariffs, which give a very generous return, the budget for the scheme would be severely depleted and there would be very little available for future solar PV generators, or for other technologies. Our view is that the urgent steps we have proposed to protect the scheme for the future are fully consistent with the scheme’s statutory purpose.
We have also made the point that the judicial review was premature as no decision has yet been taken, and a decision will only be taken after a full analysis of the responses to the consultation.”
What will happen now?
The permission hearing for an appeal by DECC is on the 13th January. If permission is granted, the appeal itself will take place the same day. From then there are a number of possible future outcomes:
DECC is refused permission to appeal = 43p tariff remains in place for all registered installations until the Parliamentary process has concluded (expected to be 1st April, but could be earlier)
DECC is granted permission to appeal but subsequently loses =
A hearing takes place (up until which a final decision is still pending) after which 43p tariff is confirmed for all registered installations until the Parliamentary process has concluded (see above)
DECC is granted permission to appeal and wins =
A hearing takes place and we return to the existing situation where a consultation process is ongoing and Government is considering responses
The Future of the Industry
Our MCS certifying body NAPIT (National Association of Professional Inspectors and Testers) have been working closely with the DECC and sit on a number of official lobbying groups, part of which included meetings with Minister Greg Barker to discuss the long term plan for a sustainable renewable industry.
Statistics show following the FIT tariff reduction on October 31st the number of solar PV installations grew by approximately 50% per week, reaching around 30,000 installations in the last week leading up to the 12th December deadline.
DECC have stated: “The tariff rate for PV installations less than or equal to 4kW will NOT fall below 21p for installations with and eligibility date between 12th December 2011 and 31st March 2012.”
If the Government does not win an appeal, a renewed period of tariffs at 43.3.p/kWh is inevitable, although how long this will be available for is not clear.
How do you get a quotation and what FIT rate will you get?
If you’ve read this far you will see the governments handling of the whole process has created a huge amount of uncertainty, leaving businesses and customers uncertain what FIT rate they will get.
We will therefore be issuing all quotes based on the post-12th December rates which were proposed in the FIT review – see Feed In Tariff (FIT) – which based on the information we have should be worst case scenario for installations completed before the 31st March 2012.
Due to further reductions in cost of equipment in Jan 2012 the lower rates still demonstrate attractive returns of between 7-10% per year.
We are expecting a rush up to the 31st march deadline, due to any new requirements/rates being introduced on the 1st April, so to avoid disappointment contact us ASAP for your free no obligation solar survey.
Web – http://www.pvfit.co.uk
Get a survey/quote – http://www.pvfit.co.uk/get-a-quote
Phone – 0344 567 9032
Twitter – http://twitter.com/PVFITLTD
DECC have today confirmed the booming solar industries worst fears by publishing their “consultation” on feed in tariff cuts for PV systems.
The table above shows the proposed deep cuts will apply to all new installations completed after the 12th December 2011. This gives customers and installers just 6 weeks to complete any existing contracts at the current rates.What’s more although the proposals are “out for consultation” the changes in tariff levels come into effect before the consultation is due to close on the 23rd December.
David Houston, Director at Chester based PV FIT Ltd, says: “Today’s announcement confirms our worst fears and makes a mockery of the coalitions claims to be behind renewables and their intention to ween people off centralised produced power”.
The proposed domestic tariff levels, which are apparently “out to consultation”, mean a 4kW pv system on an optimum South facing roof will now take 11.3 years to payback, up from 6.5 years under current tariff levels.
“We accept that costs of PV equipment have come down in the 18 months since the FITs were introduces in April 2010. These savings however only translate to a 30% saving on a fully installed system. A knee-jerk 50% cut to FITs is disproportionate and will severely affect investor confidence in a sector which has already seen large PV systems disappear over night due to similar draconian cuts earlier this year” says Houston.
The full details of the comprehensive review for PV FITs consultation can be found on DECC’s website. Other proposed changes include:
Introduce new multi-installation tariff rates for aggregated solar PV schemes i.e. where a single individual or organisation owns or receives FIT payments from more than one PV installation, located on different sites.
a new energy efficiency requirement for FITs for solar PV (see section 3 of consultation for more detail). The new requirement would apply to all new solar PV installations with an eligibility date on or after 1 April 2012 which are attached to or wired to provide electricity to a building.
Many are predicting a solar gold-rush up to the government’s imposed cut-off point of 12th December, after which solar firms will be left to reassess their offerings. There are likely to be severe job cuts in an industry which has created over 20,000 new jobs in the past year.
David Houston advised, “PV FIT currently have spare capacity in the lead up to the 12th December. To avoid disappointment you will need to book your installation ASAP – if you haven’t already had a quote we can survey over the phone in 10 minutes and will email a quote same day”.
In the lead up to 12th December PV FIT are offering full installation at following prices:
Call today for your free solar PV quotation on 0344 567 9032 or fill in our free solar survey.
New research conducted by utility and environmental consultancy Gemserv has identified huge demand from British households to ‘Go Green’ and produce their own energy.
Gemserv’s study of over 2000 British adults found that 61% of homeowners would consider installing means to generating their own energy, whether using solar PV panels, installing air source heat pumps, using biomass fuel or harnessing the power of nature by using hydro power. If the so-called ‘green gap’ could be bridged, approximately 15 million tonnes of CO2 could be saved each year, the report claims.
However, despite the UK’s appetite for renewable energy, Gemserv’s research found that the widespread lack of awareness about installation, cost savings and benefits is stopping people from reducing their carbon footprints.
In these challenging economic times, expense was understandably a big consideration, 57% of homeowners who would not consider installing any of the renewable initiatives from a list they were shown said it is too expensive and 32% of people were unsure how much money they could save and/or earn from renewable energy sources.
A further 65% of Brits weren’t aware of the government’s financial incentive for generating renewable energy.
CEO of Gemserv David Thorne says: “I am encouraged by some of these findings as I am delighted that nearly half the population would like to install renewable energy technologies; what worries me is the lack of fundamental awareness surrounding it. To bridge the Green Gap it’s essential we continue to educate consumers and break down some of the myths surrounding the Green Deal, energy efficiency and microgeneration.”
More details at www.gemserv.co.uk
Dave Houston, MD of chester based solar installers PV FIT Ltd says: “I am not surprised that Germserv’s survey identified that a significant proportion of the public would be interested to install a renewable energy technology on their homes. The costs of renewable energy systems can put many people off, despite the very attractive returns offered by schemes such as the Feed-in Tariff (FITs), due to the substantial capital outlay to install them in the first place”.
“In the past year FITs have vastly increased the size of the UK’s solar PV industry, which in turn has seen the cost of equipment & installation drop significantly. In April 2010, a typical 4kW PV FIT system cost £16,000 including VAT. In October 2011, the same system has reduced to nearer £12,000 – with a South facing system offering combined tax-free income and savings of £1700p.a”.
“With wider awareness of FITs and access to low cost, or preferably, zero interest finance we feel the renewables market could be vast, with capital costs reducing at an equally rapid rate”.
FITs are due to reduce by 9% for new entrants in April 2012, although many in the renewables sector are predicting a greater reduction due to the schemes success in reducing equipment costs.
For a free no obligation solar PV quote over the phone call PV FIT on 0344 567 9032, or visit http://www.pvfit.co.uk
All PV FIT solar energy systems now come with greater peace of mind due to a 5 year independent insurance backed guarantee covering your whole solar PV installation.
With the launch of the governments solar feed in tariff (FIT) scheme in April 2010 solar photovoltaic systems offer very attractive investment propositions in today’s financial markets.
FITs pay an above market rate for every kWh (unit) of renewable electricity you generate at home, or work, which is index linked to Retail Price Index (RPI) and government guaranteed for 25 years. Solar energy systems installed by homeowners also benefit on no tax being chargeable on any earnings from the scheme. Coupled with ever rising fuel prices no wonder solar power is the fastest growing renewable source of energy in the UK today!
Despite the high uptake and reducing cost of equipment, a typical solar photovoltaic system (10-16 panels) will still set you back between £9-13,000 including 5% VAT. This means installing PV is the next most expensive purchase to a house, or car. PV FIT recognise this and are pleased to confirm that all new installations now come with an independent insurance backed guarantee covering deposits and workmanship as standard, without any additional cost to you.
Independent Warranty Association (IWA), whom are Financial Services Authority approved providers of insurance, offer a comprehensive service whereby they assess prospective member companies against a strict set of financial, service, quality and customer satisfaction. Only on passing IWA’s audit can solar installation companies become members and offer their “Deposit and Guarantee Insurance” product.
The IWA insurance has many benefits over other policies on the market as:
- It covers contracts up to the value of £50,000
- There is nothing for you to pay – not even an excess in the unlikely event you had to claim
- The policy is fully transferable should you come to sell your home
- IWA have been selling insurance backed guarantees on home improvement services for over 25 years
We will be shortly posting a specimen policy which outlines full T&C’s onto our Solar Warranty page.
In addition to the workmanship guarantees all the products we offer also come with manufacturers warranties. We ensure that all equipment is manufactured, or if not the company have a significant presence, within the EU by suppliers whom offer the best quality product and service.
As our 5 year insurance backed guarantee is workmanship based we do recommend that you contact your building and contents insurer to get cover the your PV FIT installation against fire, theft, etc.
*no more than 4.6p/min peak rate from landlines, or free from many contract mobile phone providers
An article in The Guardian over the weekend suggests that falling costs plus generous feed-in tariffs mean return is higher than ever – but payback will fall in April 2012
Are you a homeowner with some spare cash? A 20%-25% collapse in the price of rooftop solar power units in recent months has turned the government’s feed-in tariff scheme into one of the most lucrative financial propositions for households with the right sort of property.
The scheme was introduced in April 2010, when the Labour government introduced generous feed-in tariffs to encourage households to install solar photovoltaic systems. Back then, anyone spending, say, £13,000 up front to fit a 2.5kWp system to their home was paid 41.3p per kilowatt hour (kWh) generated – enough to earn them a typical annual income of £900 a year in payments, on top of a £140-a-year saving in reduced electricity bills.
t was described as a good investment because payments for each unit of electricity generated were guaranteed for 25 years, paid tax-free, and set to rise each year in line with inflation.
If you were planning to stay in your home and had a suitable roof (unshaded, at a pitch of about 40 degrees, and facing between south-east and south-west), the main question was how big a system to install – assuming you could raise the installation costs. The bigger the system, the greater the financial return.
However, you shouldn’t worry if you put off doing anything because it has emerged this week that waiting has worked in your favour.
Solar experts say that as a result of the installation costs coming down, the investment value of the scheme has become even better. These lower installation costs, an inflation-linked increase to the feed-in tariff payments and the prospect of rising electricity prices all mean the guaranteed returns are now above 10% a year, depending on how you calculate it. And if you install before next April – when new payment tariffs look set to come into force – you are guaranteed the tariffs for the next 25 years at the old rate.
David Houston, Managing Director of Chester based PV FIT, says that “costs of solar panels have dropped dramatically since April 2010 when the feed in tariffs were launched. A year ago we were installing a 4kWp system for £15-16,000 however now we are less than £13,000 including VAT. This means a potential return on investment of 13% per year!”.
The fall in costs can be attributed to higher volumes of solar panels being installed in the UK, as well as falling tariff levels in Germany. One solar expert suggests that PV manufacturers set their prices according to the level of subsidy available.
Feed in tariff levels are not likely to remain as generous, with tariffs due to drop by 9% or more as of April 2012 to counteract the dramatic cost reductions seen to date.
Houston goes on to say “having been involved in the solar energy industry since 2003 I am used to seeing government tampering with incentives if they are seen to be too popular, or generous. We have recently seen the coalition implement a ‘fast-track review of feed in tariffs for larger scale installations’ (above 50kW), so there is no guarantee that smaller scale systems will not be put under the microscope before the end of 2011″.
The one guarantee is that existing solar installations will not be affected, with any changes only affecting new adopters. This will mean there will likely be a ‘solar gold rush’ with prospective solar generators rushing to install a photovoltaic system before any FIT reduction comes into effect.
“The current number of solar installations in the UK to date is only the tip of the iceberg. There are a vast number of residential and commercial roofs that are suitable for solar energy systems up to 50kW. The potential for growth in employment and manufacture are astronomical due to solar being one of the easiest renewable retrofits available as it inhabits your roof rather than your rooms. In addition, fuel prices are only going to continue rising based on 2 of the ‘bog six’ raising their prices for electricity by as much as 16% recently” says Houston.
PV FIT offer a free no-obligation solar survey over the phone after which you will receive a formal fixed price quotation via email. Just call 0344 567 9032 or request a solar survey to find out how much you can earn from feed in tariffs.