Monday, 12 March 2012

New FiT rates for Solar Installations.

Ofgem has confirmed that the new rate for solar PV under the Government's Feed-in Tariff scheme for existing and new installations will be increased by 2.1p to 45.4p from April 1st 2012.The new tariff will replace the current 43.3p rate and is an increase in line with the Retail Price Index (RPI) (4.8%) in December 2011.

The new tariff will apply to all new installations until March 3 and only if Energy Ministers fail to overturn a High Court ruling.The Government is appealing directly to the Supreme Court to overturn two earlier judgements that their original December 12 deadline was unlawful.Should it fail to win a Supreme Court hearing or succeed and subsequently lose its final appeal, the generation tariff of 45.4p from April 1 will apply to all registrations made before March 3.

However, if the Government is successful in having the High Court and Court of Appeal rulings overturned, the new 45.4p rate will only apply to registrations made before December 12, last year. For household solar panels registered on or after March 3, the revised 21p rate will still apply and will be increased in line with inflation in April, 2013.

We all should be concerned as the Ofgem table of revised payment rates makes no mention of the potential for retrospective cuts or the threat of a Government appeal. The Department of Energy and Climate Change in Early February announced future tariff rates for domestic solar PV will be reduced in line with industry cost reductions.

So the good news is that existing installations will see their return on investment increase by 4.8%. The potential bad news is that we're still facing an uncertain future as the government seems incapable of providing a stable environment for all concerned.

Twitter: (@solaricarus)

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