The S&G blog
FIT News for Property owners: The Government has done it again, solar PV Feed in Tariffs looking set to be slashed by over 50%! Nevertheless, the case for investment in the technology remains strong.
The Feed in Tariff (FIT), the key Government scheme put in place to incentivise the uptake of solar photovoltaic (PV) installations (amongst other renewable electricity generating technologies) on domestic properties appears to be about to receive yet another radical hair cut from the Coalition Government, the third one this year. Leaked FIT review results appear to indicate that the proposed cut to FIT rates could be as high as 50%. However, at S&G we would advocate that this should not deter from the continuing investment potential that the FIT still represents. Read here why we think so.
The Leaked Document
If the document is to be believed, and it does look fairly convincing (Download it here opens in new tab), then the FIT rates are about to be slashed by over 50%. And not only that, but the reduced rates are also looking set to take effect much earlier than originally aimed for, i.e. by 8 December 2011 instead of 1 April 2012.
The significance of the leaked document has been played down by DECC in a tweet:
'Consultation on changes to the solar PV FIT to be published to Parlt on Mon. Doc on EST site earlier was neither final nor accurate'
But what if there is truth in the figures stated in the document? Lets look at the offering that would still be available to you, the property owner, with the new FIT at 21p/kWh. At Save & Generate we have always believed in facts and numbers and the numbers clearly show that despite the eleged proposed cuts to the FIT there is still a very compelling case for investing in solar PV. Below are the numbers for a domestic mid-range 4kW PV system installed at a good UK location.
- Installed Cost: £12,500
- Generation: 3,286 kWh
- Export: 50%
- Annual income
- FIT generation: £690
- FIT export: £55
- Savings on Bills: £210
- Total annual Income: £956
- Simple Return 7.6%
- Simple payback 13.1 years
Still looking good
A solar installation still has a return on investment of 7.6%, better than any bank account by a long shot. It is also important to note that these figures are based on the conservative SAP calculation. Our own Field testing is showing performance generation much higher. There will be streams and streams of blogs and comments all over the internet screaming bloody murder and tearing the government to shreds over this, and quite rightly so. But while all of this is going on in the background, you as the property owner have more important questions to contemplate, such as:
- How can I secure myself from ever-increasing electricity bills? And let's face it, electricity prices are only going one way.
- How can I make the most of the available incentives for investment in solar PV and how do they compare with the other incentives available?
- How can I meet that level 'C' EPC rating (a new requirement for FIT qualification)?
- How can I maximising the use of free electricity from my solar PV installation and thereby improve my return on investment (ROI)?
At S&G we specialise in finding you the best options for you to improve your energy systems both on the domestic and commercial scale. For the past 18 months solar PV has dominated the options available, with this review the picture changes and other technologies such as Solar thermal are putting there hand up. The best way to answer the questions above is by having an independent energy survey that will highlight the opportunities both in energy efficiency and energy generation. Get more information on our Independent Energy Advice Services here.
Solar PV is still a good opportunity and as part of a holistic approach to your energy system can help you be more sustainable and disconnect from rising energy prices.
Have a read of our Feed in Tariff Fact Sheet, our renewable heat incentive Fact Sheet and our Green Deal Fact Sheet for more information.
At S&G we focus on providing quality independent energy advice to help you find the best solutions for your property, always coming at it from the Whole House perspective. Read more about our . You can call us or email us at firstname.lastname@example.org if you want to discuss a potential project with us further.