Solar keeps renewable incentive scheme on track

The Feed-in Tariff scheme is on course to meet its first-year renewable energy generation target of 100MW, according to industry figures.

Just over 42MW of electricity generation capacity has been installed in the six months since the scheme was launched in April, most of which was in the residential solar photovoltaics sector, the report by Ownergy said.

More than 10,000 residential solar PV systems were registered between 1 April and 29 September, producing 25MW of electricity. Some 87 non-residential solar systems producing 0.57MW were completed, along with 64 non-residential wind systems, producing 5.5MW.

No new anaerobic digestion systems were registered, largely due to poor rates of return discouraging investment in the technology, the report said. The FiT level for small-scale AD plants was widely criticised for being set too low when the scheme was launched.

Ownergy chairman Philip Wolfe said that overall the scheme was delivering its intended aims, but investor confidence and future uptake of renewable technology could drop dramatically if tariff levels were reduced prematurely.

“The scheme has a long way to go before we are in the enviable position of having to consider dampening enthusiasm through lower tariff rates as is happening in some countries in continental Europe,” he said.

“If the government believes that an early review of tariff levels is required, it could not be more mistaken. It must also be stressed that the Feed-in Tariff is paid for through a levy on electricity bills and is not from public expenditure. As such it can make no contribution to reducing the public sector deficit.”

Ownergy estimated that the total installed capacity to-date would add less than 2p per month to the average electricity bill.

The report highlighted six challenges facing the industry:
1 Payback of 10-12 years dissuades consumer investment
2 Lack of financing for small and medium installations
3 Initial capital outlay required can slow decision-making
4 Concerns about long-term implications of renting roof space
5 Speculation about government cuts to FiT
6.Awareness of FiTs remains low

Total FiT registrations between 01/04/10 and 29/09/10