Consultation on fast-track review of Feed-in Tariffs for small scale low carbon electricity announced

The government announced on 18 March that it plans to cut Feed in Tariffs ("FiTs") for low carbon electricity generation systems with a rating of between 50kW and 5MW.

Only a limited pot of funding is available for FiTs, which are available for projects with a rating of up to 5MW.  The government announced the fast track review to address the unforeseen problem of a large number of commercial 5MW solar 'farm' projects using up the pot of funding.

Aside from complaints from the backers of the larger commercial schemes, the government's proposals have also been criticised as they would affect many smaller non-domestic projects such as solar photovoltaic (PV) systems with a rating of more than 50kW that might be installed in larger schools, and in businesses such as supermarkets.  Such projects would only receive 19p per kWh under the proposals, compared with the 31.4p they currently receive.

Subsidies for schemes under 50kW would remain unchanged under the plans, which means that many schools and other smaller non-domestic schemes will still be able to benefit as before.

Although any changes will only affect new entrants to the FiT scheme, new projects must be commissioned before 1 August 2011 to benefit from current FiT rates, as the government plans to implement the changes from this date.

The Department of Energy and Climate Change is seeking views on the proposed FiT changes until 6 May 2011.  The consultation can be accessed at this link.

The proposed new FiT rates are as follows: