Dated:  27th August 2015

Massive Cuts to Feed-in tariffs

The UK government is proposing massive cuts to feed-in tariffs for renewable technologies including wind and solar.

Under proposals put out for consultation today, supports for wind of between 100kW and 500kW will fall from 10.85p per kilowatt-hour to 4.52p/kWh, while wind between 500kW and 1.5MW will fall from 5.89p to 4.52p.

Turbines larger than 1.5MW will not be eligible for feed-in support.

Solar installations of 2.5kW to 1MW will have their rate cut from 5.94p/kWh to 2.28p, while installations above 1MW will be cut to 1.03p.

Hydro escaped with drastic less but still deep cuts, with 2MW-plus project going from 2.43p to 2.18p and installations between 500kW and 2MW going from 8.91p to 6.56p.

DECC said that if cost control measures are not implemented “the only alternative would be to end generation tariffs for new applicants as soon as legislatively possible, which we expect to be January 2016”.

Tariffs as mapped will run through 2018-19, when measures will either be revisited or removed completely.

Rates will be subject to a “default degression mechanism” under which rates will fall steadly on a quartely basis in a pre-mapped reduction.

The overall feed-in budget will be limited over the lifetime of the new regime to between £75m and £100m.

“This is the uppermost level that we currently consider to be affordable within the context of higher than expected spend on the LCF and given that the FITs scheme has either achieved for wind, anaerobic digestion and hydro, or is close to achieving for solar PV, projected deployment,” said DECC.

Spending will be limited through “deployment caps” on individual technologies, imposed on a quarterly basis. For solar this will total roughly 30-35MW per quarter, for wind roughly 20MW and for hydro between 13MW and 15MW. Anaerobic digestion will be pegged at around 6MW every three months.

Consultation runs through 23 October.