Feed-In Tariffs

Feed-In Tariffs

Dr Aidan Bell
Director, EvoEnergy

Reaction to the Department for Energy and Climate Change’s White Paper on Feed-In Tariffs, 15th July 2009

The UK has lagged behind continental Europe since Hans – Josef Fell first tabled the idea of Feed-In Tariffs to the German government, a scheme which guarantees an above market rate price for electricity generated from renewable sources like, solar photovoltaic (PV), for a period of twenty years.

Ed Miliband’s presentation yesterday morning in the common’s indicated a Feed-In Tariff in Britain for the first time to be introduced in April 2010 and as a renewable energy professional I was amazed at the intelligence of the tariff for microgeneration.  The hundreds of pages surrounded the issue showed they had learnt from the mistakes made abroad.  The feed in tariff is layered by size so that smaller, and necessarily more expensive, PV systems become investable whilst larger PV systems are not going to make a fast-buck for venture capitalists as they have in Spain and Italy, but that sensible long-term investors such as pension funds might see them as attractive.

The tariff is also layered by technology type so that continued investment in all types will be encouraged.  This will help bring the idea of electrical generation down to a home or community level and because there are no restrictions on how the systems can be integrated will provide the best possible return on any of the technologies.

One of the overlooked features of the tariff is making people recognise how difficult it is to generate electricity, something that is simply taken for granted, but really shouldn’t be and therefore educating people in the need to become more efficient.

Photovoltaic Feed in Tariff

Size of PV System

Feed in Tariff (pence / kWh)

<4kW (new build) 31.0
<4kW (retrofit) 36.5
4-10kW 31.0
10–100kW 28.0
100kW–5MW 26.0
Stand alone system (Off Grid) 26.0

A typical home photovoltaic system costing 2.55 kWp system might cost £13,400 and if mounted on a south facing roof in the midlands would be expected to generate 2126 kWh/yr which would now be worth £967 / year if half the electricity is used and half exported.

Without grant that’s an impressive 7.22% return on your PV investment

With a £2,500 grant still available from the Low Carbon Building Programme that’s 8.87%

Full praise to the DECC!

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