Plans to change what households make from solar Feed-in Tariffs 'feels a breach of pro

michaels

[Deleted User] said:

ppppenguin said:

When I signed up for FIT, both parties agreed to RPI indexing for 25 years. Regardless of fairness or accuracy, a contract is a contract and cannot be changed unilaterally by one party after the event. It is fundamentally dishonest to attempt to change the terms of contract part way through. It is also an abuse of power, using the overwhelming power of government against parties who, for the most part are private individuals of limited means who have limited ability to fight this in the courts.

In any case, it's a historic matter, as there have be no new FIT contracts since 2019.

You say "regardless of fairness" but I would like to think that most contributors to this forum consider "fairness" to be important. The effect of this change will be to reduce the income of FIT beneficiaries, many of whom are making a killing, by reducing the burden on the other energy customers who are paying for this. This is not about filling the government coffers, it's about balancing things out between energy users in a more equitable way (or should I say less inequitable way?) Regardless of the contractual position, is that really a bad thing?

Forgive me for being blunt, but your post does have a feeling of "stuff everyone else" although I suspect that wasn't your intention.

I think your pay is unfairly high mmmmikey and your employer should unilaterally reduce it.  I also think your fixed rate mortgage is too cheap and your lender should unilaterally increase it.

Can't say 'fairer' than that?

Scot_39

inspectorperez said:

Just to provide some context to this discussion I was checking out my own spreadsheet this morning which has been maintained from Day 1 just to see what the financial returns have been over the years.

During the latest calendar year 2025, I have received £2759 for generating 3,601 Kw. This compares with year 1 in 2012 when I received £1,713 for generating 3,597Kw.

I haven't bothered to calculate investment returns and the like (capital installation cost was circa £10K for 16 panel array) but tbh, I am more than satisfied with this financial return. Right at the outset, I was expecting that there would be some form of impairment over the years with the hardware becoming less efficient in terms of generation capability, but so far this has not proved to be the case. The initial capital outlay was covered in circa 4.5 years and everything since then has been surplus apart from a small cost to install anti pigeon measures.

In terms of this current government lead consultation on varying the contractual terms, it might seem churlish to maintain the high ground and insist that the contract is honoured in it's original form, but by the same token I wonder if the government would give "generators" like myself the option of voluntarily accepting a variation of terms by accepting CPI rather than having it imposed on them?

Thanks for having the guts to publish the figures - which look like

c43p/kWh in 2012 - and c77p now.

Against a wholesale market rate for next day delivery - in the 6p-7p in late summer - the Ofgem chart I looked at only went as far as Sep.

And although you might have timed it wisely - given the rates dropped as prices dropped c2012 - it still shows the degree of profits being made - from these contracts that are far far from being in the wider publics interest.

And for those who think the govt isn't willing to rip up contracts - regarding the post above about fixes being fixes - well not in the eyes apparently of our energy minister 

https://forums.moneysavingexpert.com/discussion/6644013/energy-secretary-backs-martin-lewis-ask-for-those-on-fixed-tariffs-to-benefit-from-150-off-bills

gefnew

This is the breakdown at the beginning of having panels fitted 2011.

Scot_39

So you get paid fit, indexed in this case from 43p - so an early adopter before rates cut c2012 - you get to use some of the energy so have a saving and then the bit I dont quite get - column with the 3.1p export rate and starting at £51.7 - but should that be not used on site - as your adding the column to total income and savings ??

You break even on investment in 5 years but tge escalation continues for 25 years.

So in that example c2025 now - the total benefit after 14 years is already 3x tge investment - 200% profit - and a projected 7x by the end of term - 600% profit.

And people here on these terms think its fair on other consumers to be paid 75/77p now cf general wholesale rates of 6p  - plus future escalations  and add significantly to everyone else's bills / rates in order to do so.

Doc_N

Scot_39 said:

So you get paid fit, indexed in this case from 43p - so an early adopter before rates cut c2012 - you get to use some of the energy so have a saving and then the bit I dont quite get - column with the 3.1p export rate and starting at £51.7 - but should that be not used on site - as your adding the column to total income and savings ??

You break even on investment in 5 years but tge escalation continues for 25 years.

So in that example c2025 now - the total benefit after 14 years is already 3x tge investment - 200% profit - and a projected 7x by the end of term - 600% profit.

And people here on these terms think its fair on other consumers to be paid 75/77p now cf general wholesale rates of 6p  - plus future escalations  and add significantly to everyone else's bills / rates in order to do so.

None of that is remotely relevant to the question of whether or not a freely entered into contract should be broken unilaterally by the government. This was very much an unknown area at the time these contracts were entered into, and the life expectancy/ reliability of panels and inverters was a gamble. It could have been disastrous for early adopters. If you bought a lottery ticket and won £150m, I suspect you’d be pretty miffed if the lottery operator decided to pay out only £100m because that was quite generous enough.

Scot_39

You seem to think your fit domestic solar panels are still anywhere near as important to green and net zero targets as they were in that example in 2011.
Or for that matter UK net zero policy still commands the support of the uk population, or the political parties vying to represent them in future.
Some would argue if beneficial at all most of the time now , when the reality now is the electricity costs in UK are now - certainly on a breezy summer day, plagued by an expensive (but nowhere near as expensive as these 75p fit rate examples in other cases)  renewable capacity mix that all too often risks exceeding demand for many daylight hours.
When grid level solar itself now c12GW installed and controlled by grid companies - earns curtailment payments.

I suspect many of the likely over 28m households paying the bills for FIT -  not with fit solar panels installed - would agree these contracts need not this minor suggested return tweeking but rewritten completely.

And the energy minister himself has now written to suppliers to break fixed price tariff contracts in April for govt policy changes on  eco and levies in the budget - shifting.both from bills to general taxation.

So if he can advise breaking a 1 year contract - the govt can certainly break a 25 year contract - even if need legislation to do so.
Or in this case review it's terms - which some posters above suggest is in fact 100% permitted under their contracts anyway.

Doc_N

Scot_39 said:

Its entirely relevant.

And I suspect over 28m households not with fit solar panels installed would agree.

And the energy minister himself has now written to suppliers to break fixed price tariff contracts in April for govt policy changes on  eco and levies - shifting.both from bills to general taxation.

So if he can advise breaking a 1 year contract - the govt can certainly break a 25 year contract - even if need legislation to do so.

Or in this case review its terms - which some posters above suggest is in fact 100% permitted under their contracts anyway.

There is a very real difference between a contract being changed voluntarily by the stronger party in a contract to the benefit of the weaker party, and a contract being changed by the stronger party against the will of the weaker party.

Scot_39

This isnt even about being green anymore - the initial purpose of the scheme -  it seems to me - its clearly more about the money.

As above some are happy that their profits and returns will still be more than enough for them under the proposal.

And it should be remembered the true victim here is the poor being expected to pay the profits to the rich with fit solar panels installs.

Not those facing a minor downgrade in those profits.

gefnew

Sorry but all that information was available to both parties at the time.
they did some recalculations after 2012 and reduce Fit payments and contract period to twenty years from 25 to claw back there obvious poor calculations.
The window to get the twenty five year contract was small and demand high ceasing the cost to have solar fitted to rise and not enough installers to fill demand.
By taking a huge gamble the kit and cost was quite high.

matt_drummer

They did reduce it quite considerably from what it was at the outset.

The panels I took over in 2021 cost nearly £15,000 in 2014.

The annual generation payments this installation will receive barely cover the cost of installation.

The initial installations were overly generous though.

The example above shows that there was very little risk! The installation would pay for itself very quickly.

That example is seriously flawed though compared to reality as it massively overstate the benefit of the owners own consumption.

I do agree though that a contact is a contract and really shouldn't be changed.

But, I can understand that expecting people who are struggling with energy costs to continue to contribute to what many would describe as obscene profits is difficult.