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Green subsidies

edited 30 November -1 at 1:00AM in Discussion Time
149 replies 1.2K views
CardewCardew Forumite
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edited 30 November -1 at 1:00AM in Discussion Time
https://www.theguardian.com/business/2017/feb/08/uk-government-green-energy-subsidies-energy-bills
MPs have criticised ministers for their “shambolic” failure to regularly spell out the impact of government green policies on household energy bills.
The Commons public accounts committee said the government had missed its commitment to publishing annual reports on how consumer bills were affected by subsidies to support solar and wind power.
The Department of Energy and Climate Change made the pledge in July 2014, but has not given an update on the implications for householders since November that year. Renewable energy subsidies such as the feed-in tariff for solar power are ultimately paid by consumers through government levies on energy bills.




“Either they’re trying to hide something or they’re incompetent. It’s not on, because it affects both the [energy industry] supply chain and consumers,” said Labour MP Meg Hillier, the committee’s chair.
“If it was taxes, we’d all be looking at it much more closely – but it’s still money out of people’s pockets and it’s not acceptable. (my bold)It’s just shambolic really.”
In a report published on Tuesday, the committee said officials should disclose the costs and savings from the green policies so consumers could decide if they were good value for money.

I wonder how many consumers - or MPs for that matter - are aware that early adopters of solar PV(invariably house owners) are now getting over 50pence for every unit(kWh) they generate and, to add insult to injury, they don't have to export a single kWh if they can use it in the house.

Even worse this tax free and index linked subsidy will continue for another 18 to 20 years, and is paid for by a levy on all customer's bills.

I am aware that many of the regulars on this forum are aware of the truth of the above, but of course there are new readers of this forum who might be enlightened.
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Replies

  • pinnkspinnks Forumite
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    Personally I am a middle adopter and receive about 40% of that amount but whenever people adopted they did so after looking at their green reasons for so doing (and yes, some of us have those) and how the offered subsidy would enable them to afford or justify affording that capital outlay. I don't think it's either warranted or helpful to suggest that ordinary people who invested and signed up to a particular subsidy offered by central government should be held out to in some way be profiteers or "un-nice" people. If anything it was the design of the subsidy that was ill-informed and which should be criticised.

    Sure the figures look odd given the way that costs have fallen but don't forget those early adopters shelled out massive sums of money - 3, 4 or even 5 times what it now costs. And while I am sure others will chip in with the nuclear v wind v solar debate it is a fact that governments of all political persuasions have heavily subsidised electricity for years.

    If we don't like what a particular government does we have a democratic process to change that and this forum is as good a place as any to air those views and muster support for whichever side of the debate one supports but we shouldn't demonise people (or give people reason to suggest that is what is being done) who did no more than accept what was on offer at any particular time, simply because the deal they signed up to now looks odd compared to more general market conditions.

    Should FiTs have been so high at the outset? Who knows.

    Should they have been index-linked and run for 25 years? Who knows.

    Should they have begun reducing rates earlier? Who knows.

    Leaving aside ones personal views on the merits or otherwise of solar it was government policy to support and encourage its adoption and FiTs is the way they decided to do that. Would people have adopted it without the subsidy and would world prices have come so quickly without government support in whichever countries have or had such support? Again, who knows.

    These are quite rightly all questions for the National Audit Office to report on and for PAC to debate and in my experience the PAC's voice is heard and things do change as a result. Whether that will happen with solar and if so what that would look like will ultimately come out in the wash but that, and other routes into the government machine, not to mention exercising ones right to free speech in the hope that others will listen and ones vote in general elections.

    I feel comfortable with what I have invested and the terms on which I signed up to the offer from government. Would I have done that without subsidy? Good question. I may have but having been in my mid 50s at the time the maths and deliberations would have been quite different.

    I see the same sort of demonization arising now around diesel vehicles. They were the bees knees from a government policy perspective a few years ago - much better for than those nasty petrol vehicles. Now the tables have been turned and diesel drivers are beginning to be seen as social pariahs for having done nothing more than listen to their government of the day and make their decision accordingly.

    So, having lit that blue touch paper I will retreat and watch the firework display:beer:
    Wiltshire - 5.25kWp
    3.5kWp: 14 x Phono Solar 250 Onyx, Sunny Boy 4000TL, WSW 40 degrees, June 2013
    1.75kWp: 7 x Phono Solar 250 Onyx, Sunny Boy 1600TL, SSE 45 degrees, March 2014
  • Exiled_TykeExiled_Tyke Forumite
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    Haven't we been through all this before? And many times?

    I wonder how many tax payers realise how much government money is to be wasted on Hinckley Point?
    Install 28th Nov 15, 3.3kW, (11x300LG), SolarEdge, SW. W Yorks.
    Install 2: Sept 19, 600W SSE
    Solax 6.3kW battery
  • pinnkspinnks Forumite
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    Quite a few people in the west as it was highlighted on regional news this week, or last week:T
    Wiltshire - 5.25kWp
    3.5kWp: 14 x Phono Solar 250 Onyx, Sunny Boy 4000TL, WSW 40 degrees, June 2013
    1.75kWp: 7 x Phono Solar 250 Onyx, Sunny Boy 1600TL, SSE 45 degrees, March 2014
  • CardewCardew Forumite
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    pinnks wrote: »
    I don't think it's either warranted or helpful to suggest that ordinary people who invested and signed up to a particular subsidy offered by central government should be held out to in some way be profiteers or "un-nice" people. If anything it was the design of the subsidy that was ill-informed and which should be criticised.


    Should FiTs have been so high at the outset? Who knows.

    Should they have been index-linked and run for 25 years? Who knows.

    Should they have begun reducing rates earlier? Who knows.



    I see the same sort of demonization arising now around diesel vehicles.

    Nice measured post - albeit I do take issue with one of your points.

    On this forum I haven't seen any 'demonization' of any individual taking advantage of the FIT scheme; certainly I have made that point several times. Even entrepreneurs who took advantage of the indefensible decision to allow 'Rent a Roof' firms to install many thousands of systems and claim the FIT clearly intended for single homes cannot be criticised.

    My criticism was of the Government allowing such a system, and instead of the subsidy being paid from general taxation, it is, and will be for the next 18+ years, paid by a levy on all electricity users.
    Thus many occupants(owner or tenants) of flats or unsuitable houses and tenants cannot take advantage of the lucrative FIT subsidy. As George Monbiot so accurately stated before the introduction of the scheme.
    "Those who hate environmentalism have spent years looking for the definitive example of a great green rip-off. Finally it arrives and no one notices. The government is about to shift £8.6bn from the poor to the middle classes. It expects a loss on this scheme of £8.2bn, or 95%(1). Yet the media is silent. The opposition urges only that the scam should be expanded."

  • CardewCardew Forumite
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    Haven't we been through all this before? And many times?

    I wonder how many tax payers realise how much government money is to be wasted on Hinckley Point?

    I did say in my opening post:
    I am aware that many of the regulars on this forum are aware of the truth of the above, but of course there are new readers of this forum who might be enlightened.

    Reading through the many thousands of posts on the 'green and ethical' forum, it seems that there are lots of subjects that come up again and again and again - Hinckley Point for example;)
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  • tunneltunnel Forumite
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    Cardew wrote: »
    My criticism was of the Government allowing such a system.
    Then vote them out instead of rinsing and repeating on here.
    Cardew wrote: »
    As George Monbiot so accurately stated before the introduction of the scheme.
    Oh gawd.....here we go again.
    I'm off with pinnks to retreat and watch the fireworks.......AGAIN
    2 kWp SEbE , 2kWp SSW & 2.5kWp NWbW.....in sunny North Derbyshire
  • edited 12 October 2017 at 11:17PM
    EctophileEctophile Forumite
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    edited 12 October 2017 at 11:17PM
    The government have been utterly incompetent over the FIT scheme from the start. It was supposed to build a stable and sustainable renewables industry. Instead, it has been boom-and-bust, with many of the installers going out of business.

    Instead of gradually ramping down the FIT payments, they left them too high for too long. As a result, people like me paid too much for our systems, allowing the installers to make big profits in the short term. We were willing to pay the excessive price because the FITs were so high.

    Eventually, the government realised that the money they had allocated was running out fast, panicked, and announced a big cut. It's been a series of stepwise cuts ever since, as the money gets closer and closer to running out. As a result, people buy when the FITs look good compared with the installation costs, and hold back when they don't. Of course, in the lean periods, a few more installers go bust.

    As for export metering, you can blame the electricity companies for that. The normal electricity meter can't measure export. Rather than install a meter that can, the electricity suppliers would rather pay a "deemed" amount equal to half of what is generated. They are no doubt assuming that the real export figures are more than 50%. Many people have chosen to take advantage of this system and install "diverters" so that they can use the free electricity for water heating.

    A sign of how little the electricity companies are interested in paying the correct rate for exports can be seen in the new "smart meter" roll out. The meters that my supplier is rolling out are perfectly capable of measuring export. But the electricity company has chosen not to have them calibrated and certified to do so. So any readings from the meter cannot be used for billing.
    If it sticks, force it.
    If it breaks, well it wasn't working right anyway.
  • Martyn1981Martyn1981 Forumite
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    Hinkley Point C (HPC) alone (not nuclear, just one nuclear powerstation) will add twice as much in subsidies to household bills as the PV FiT has.

    Yet in 7.5yrs PV has gone from the most expensive form of generation to the cheapest around the world, and almost the cheapest in the UK, and the subsidy has fallen 93% since launch.

    Whereas HPC (after 60yrs of nuclear industry subsidies already) will in 2027(ish) start to receive a 35yr subsidy of about £50/MWh, whereas on-shore wind, off-shore wind and PV now require 15yr subsidies of about £0-£10/MWh to encourage new deployments.

    When we compare the HPC subsidy to what 'it could have bought' in new off-shore wind generation we find, taking capacity factors, subsidy terms and relative costs into account:-

    3.2GW x (0.92cf / 0.50cf) x (35yrs / 15yrs) x (£47/£10) = 64.57GW

    That's a hell of a lot of wind capacity.

    And whilst this is only a thought exercise, we can go further and compare annual generation, with

    HPC (at 92%) generating 25.79TWh's pa
    64.57GW of off-shore wind generating 282.81TWh's

    The UK currently uses about 350TWh's pa.
    Mart. Cardiff. 5.58 kWp PV systems (3.58 ESE & 2.0 WNW)

    For general PV advice please see the PV FAQ thread on the Green & Ethical Board.
  • Martyn1981Martyn1981 Forumite
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    Cardew wrote: »
    and, to add insult to injury, they don't have to export a single kWh if they can use it in the house.

    Just to be clear, the FiT is paid on generation not export, so PV'ers are not actually doing anything wrong.

    Also, 1kWh of generation consumed on site, or exported and consumed on site by the neighbours has exactly the same impact on the National Grid (NG) by reducing it's need to supply that 1kWh from fossil fuel generation. In fact, due to system losses the NG would have to supply about 1.08kWh if it wasn't for the distributed PV generation of said 1kWh.

    So on-site consumption is not bad, it's not even 'naughty', it's actually perfectly correct and means that demand side PV generation is displacing centralised fossil fuel generation from the grid.
    Mart. Cardiff. 5.58 kWp PV systems (3.58 ESE & 2.0 WNW)

    For general PV advice please see the PV FAQ thread on the Green & Ethical Board.
  • Martyn1981Martyn1981 Forumite
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    Cardew wrote: »
    Thus many occupants(owner or tenants) of flats or unsuitable houses and tenants cannot take advantage of the lucrative FIT subsidy. As George Monbiot so accurately stated before the introduction of the scheme.
    "Those who hate environmentalism have spent years looking for the definitive example of a great green rip-off. Finally it arrives and no one notices. The government is about to shift £8.6bn from the poor to the middle classes. It expects a loss on this scheme of £8.2bn, or 95%(1). Yet the media is silent. The opposition urges only that the scam should be expanded."

    But occupants of all flats, all houses, all domestic properties can't take advantage of any of the other subsidy schemes for renewables, nuclear, nor fossil fuels. So FiTs doesn't prevent everyone, like the other schemes, instead it opens up the door to many, making it the fairest generation scheme there is.

    At the time the government decided to cull PV and on-shore wind subsidies in 2015, around 20-25% of all domestic PV installs were on council/social housing, thereby reducing the cost of electricity to tenants, without them having to spend any money on the install.

    Regarding George Monbiot and his claim that the whole £8.6bn would be paid by the poor, he did admit that this was untrue round Mch 2010, and admitted that the £8.6bn FiT subsidy would actually be paid by all electricity consumers and sectors. I believe this has been pointed out many, many times from around 2012 onwards.

    Unfortunately George Monbiot also claimed that PV was many, many times more expensive than wind and hydro, but is now as cheap, or cheaper (just 7 years later), he also claimed that PV generation meters would be falsely wired to boost subsidy claims, but this is completely untrue. In fact his article was piece by piece dismantled by a large number of commentators as can be found on this site:

    Growing Backlash to Monbiot Attack on Solar PV

    So his article was discredited back in 2010, and has since been discredited by actual events.
    Mart. Cardiff. 5.58 kWp PV systems (3.58 ESE & 2.0 WNW)

    For general PV advice please see the PV FAQ thread on the Green & Ethical Board.
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