Editor's blog

This was the most unkindest cut of all

F-I-T for purpose?

26/01/2012 13:19:15

Am I the only one getting a teeny bit confused with all the toings-and-froings with the Feed-In-Tariff saga?

The last administration set the tariff levels, then, this lot hacked them back in order to save money, parts of the industry took them to court on the grounds that they way they cut the rates was illegal (see also various education authorities vs. Education Secretary Michael Gove on the cancellation of the Building Schools for the Future programme).

Anyway, the court decided that the plaintiffs were right and that The Government had acted illegally. Not surprisingly, the Government disagreed with this and appealed. Yesterday it was told that it can't appeal. Then Energy Secretary (at the moment?) Chris Huhne announced that the fight would go to the Supreme Court of Appeal as he disagreed (again).

Huhne said yesterday that, in the light of the decision to appeal: "We cannot rule out the possibility that lower tariffs could be applied to installations which became eligible for FITs on or after the proposed reference date. It is important that consumers are aware of this".

The solar thermal and solar PV markets are growing - one of the few sectors to have done so throughout the recession - you just have to look at the number of roofs, both domestic and non-domestic that have had the panels installed.

Announcing that the rates paid for electricity generated would be halved is one thing, though it was never going to be popular. Announcing it before the end of the consultation period on the whole renewable issue is quite another. On the whole on that issue, I'm inclined to agree with the court.

However, I also find myself agreeing with another part of Huhne's statement yesterday when he said: "The reason for appealing is that we want to maximise the number of installations that are possible within the available budget for FITs, rather than use available money to pay a higher tariff to half the number of installations. Solar PV can have strong and vibrant future in UK and we want a lasting FITs scheme to support that future and jobs in the industry."

There is finite amount of money in the pot for the FITs. Surely, it makes more sense to pay out a lower rate - yet one that still provides a reasonable, if long-term, return on investment - to more people. That's how we will build a sustainable, long-term industry sector. And, while the solar sector probably has its fair share of get-rich-quick-and-get-out-merchants, the majority of people want to see this sector grow and develop.

But here, again, the Government seems to be saying it wants one thing - a sustainable, long-term industry sector - but actively doing everything it can to discourage its development. The fact that it is even thinking about linking the FITs with Energy Efficiency Measurements like cavity and solid wall insulation shows how blinkered DECC's view is to and how biased it is towards larger, multi-national organisations like the energy companies with multiple disciplines to call upon.

Smaller installers and plumbing companies with their links to the householder and to the merchant sector are vital if the renewable market is to be sustainable in the long-term.

The Government seems already to be intent on killing the insulation sector, let's not let them bugger this one up as well.

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