Sheffield Renewables are deeply disappointed at the results of the review of the Feed-in Tariff (FiT) by the Department of Energy and Climate Change. Large cuts to the tariff will be implemented, they are not as drastic as first proposed, but this is little consolation as the FiT will no longer be a means of making our community owned solar schemes financially viable. For example the rate for our last scheme was 11.3p/kWh, this would drop to 4.59p/kWh if the scheme had been commission from the 8th February 2016.
The solar industry was working towards no longer needing subsides by 2020, but this won’t be the case. The resulting impact on the industry will become apparent in the coming year. The results demonstrate a lack of commitment to support renewable and community energy and will no doubt affect investor confidence.
To summarise the key points, particularly of interest to Sheffield Renewables;
- The rate banding currently used by Sheffield Renewables will be cut to 40% of existing rates
- Deployment caps will be introduced, limiting installations to around 2000 or 68 MW per year
- The degression of this rate will be 10% each quarter if deployment caps are met
- The export rate will be maintained at its current rate, 4.85 p/kWh
- There are no provisions for community energy, but this will be kept under review by DECC
DECC also recently announced that renewable energy investments will be excluded from the Enterprise Investment Scheme (EIS) and the Seed Enterprise Investment Scheme (SEIS), these offered tax breaks to investors that saw Sheffield Renewables members receive 50% of their investment back through a tax rebate.
To end on a positive note, these cuts do not affect our existing schemes, who will continue to receive FiT payments as set when they were commissioned. Sheffield Renewables is still very much committed to developing community energy schemes. We have recently been awarded funding through the Urban Community Energy Fund to develop further schemes, part of this will be to explore alternative ways of financing schemes.