MSE News: Government plans to slash solar panel earnings

Richie-from-the-Boro

The chart below shows all of the 2012 climate change policies that in some way increase energy bills :



I'm all for WHD which is DWP sanctioned for those in 'fuel poverty', the rest of the tax is nothing more than GOV smokescreen which generates economic activity [money straight into the pockets of businesses] indicator and employment statistics. When you add in the EU emissions directives alone we are paying nearer £500 a year in green tax's. Its time the renewable industry stood on its own two feet, if green worked then it would not need to suck dry taxpayers money to subsidise unsustainable green investments. Anyone wanting a windymill or solar go get it and and enjoy the feeling it gives you, I applaud your motives but you must have the courage to put your own money where your beliefs are - not my money paying for your belief.

Jim1951

Does anyone know how the new solar payments will effect existing owners in Northern Ireland as we don't have FIT but ROC payments?

Ectophile

To me, the government have been utterly incompetent in the way they have handled the whole FIT scheme.

The idea of the initial high FIT was to encourage early adopters, and kick-start a new low-carbon energy industry.

They completely failed to spot that prices for solar panels were dropping and kept the FIT too high for too long. As more and more people signed up, the pot of money allocated started running out faster and faster.

Since then, they have repeatedly panicked and made sudden large cuts to the FIT. The latest proposals would make solar completely uneconomical for most people.

So they are now proposing to kill off the solar industry, while continuing to pay the high FITs to the early adopters for many years to come. So the whole thing ends up a monumental waste of money that fails to achieve what it was originally set out to do.

rogerblack

I'd also suggest that it is now time to ditch almost all of the regulation that goes to limit what can be done.
With FIT + export lots over electricity rates, you need to keep a really close watch to make sure people aren't simply connecting from their normal electricity to the panels.

With it significantly under this, this is not a concern at all, and there should be a way to opt out of regulation.

(By 'opt out' - I mean simply treat it as any other electrical installation - with the added step of letting your DNO know.)

rogerblack

Ectophile wrote: »

To me, the government have been utterly incompetent in the way they have handled the whole FIT scheme.

The idea of the initial high FIT was to encourage early adopters, and kick-start a new low-carbon energy industry.

It's regrettably been insanely dealt with - the subsidy should have been going to the most efficient solar preferentially, not subsidising the barking mad industry of putting it up on peoples roofs.

[Deleted User]

Also if you price up an install, every time the subsidy decreases, by some miracle of finance so does the installation cost.

When once it cost £15k for a 4kW install, it is more likely to cost £6k today.

This cannot be down just to cost efficiencies in the manufacturing chain.

Martyn1981

gsmlnx wrote: »

Also if you price up an install, every time the subsidy decreases, by some miracle of finance so does the installation cost.

When once it cost £15k for a 4kW install, it is more likely to cost £6k today.

This cannot be down just to cost efficiencies in the manufacturing chain.

Actually it is mostly down to cost efficiencies as the production levels of PV have soared. The cost of PV has reduced from around $70/Wp in the 70's, to about $7/Wp ten years ago, down to about $0.70/Wp now.

BOS (balance of system costs) haven't fallen as fast, but inverters are around half what they were 5 years ago, and of course all the staff training costs have now been incurred, and installs typically take one day or less now, compared to 2 days 5 years ago.

The UK FiT subsidy has repeatedly failed to keep up with falling install prices. It should have been cut Autumn 2011, when prices had already nearly halved, down to around £11k. By late 2011 prices were around £10k, and by the time the FiT was cut in Mch 2012 (to 21p) prices were down to around £8k. The next major cut in Aug 2012 (to 16p and a term reduction from 25yrs to 20) was well matched to the falling prices which were reaching £7k(ish). Since then the subsidy has been linked to install levels, the more that is installed, the faster it is degressed.

However, the current subsidy level of 12.5p (1/10/15) is now way too high again, as prices have fallen fast (£4.5k to £6k), and are once again starting to drive installs at higher levels. A FiT rate today of around 8.5p or less would be more suitable, and would be roughly on par with the net metering subsidy preferred by the US.

Mart.

Cardew

gsmlnx wrote: »

Also if you price up an install, every time the subsidy decreases, by some miracle of finance so does the installation cost.

When once it cost £15k for a 4kW install, it is more likely to cost £6k today.

This cannot be down just to cost efficiencies in the manufacturing chain.

Agreed, the 'get rich quick' firms charged what the market will bear.


Then other firms realized quick money was to be made, so there was more competition.


It is hardly a high tech industry, erect scaffolding, bolt panels to roof and run cables - an electrician can connect up in ??

WestonDave

What's interesting in terms of energy prices is to look at figure 1 in the consultation document. (https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/456630/FIT_Review_Con_Doc.pdf)


One of the stated reasons for cutting FiT's is that it looks like pushing the total paid in various levies etc over the target for the Levy Control Framework - and sure enough Figure 1 conveniently shows the total above the LCF line and FiT's making up pretty much all of the amount over the limit. However look closer and you'll see that the FiT amount doesn't change significantly over the period - the big increase is in something called CfD's (Contracts for Difference). These arise because the government has agreed incentives with the likes of EDF to build their nuclear power stations and the CfD's are the amount that has been agreed EDF will receive over the going rate for electricity as a "subsidy" (not that they are honest enough to call it that).


So two things become clear from that nice graph. Firstly the amount paid out of bills for renewables etc will continue to increase (but not caused by a significant increase in FiT amounts) and that secondly cutting the amount paid out in FiT's helps make room for nuclear subsidies.

Gale_3110

I see lots of solar bashing on here but what about people whose livelihoods depends on it? the Government are selfservative who want to protect the money of the rich fat cats who invest in oil and gas rather than be actually do something about climate change and protect the environment.

These cuts will not only wipe out the domestic market but the supply chain and everything associated. we are talking 10's of 1000's of jobs - is that really worth it when the average bill payer will save around £1 a year!