Feed-in tariffs: solar tariffs to be slashed



On 18 March 2011 the Government published its "Consultation on fast-track review of Feed-in Tariffs (FITs) for small scale low carbon electricity". As indicated in February, the consultation includes proposals to significantly reduce the tariff support available to all new solar photovoltaic (PV) installations over 50kW and stand-alone installations.

In the Government's view, the proposed tariff changes will bring the UK into line with changes being made elsewhere in Europe. It also believes they are necessary to ensure sufficient financial support remains available to encourage smaller solar PV installations and other FIT technologies.

The consultation has thrown the large-scale solar PV market into disarray with a number of projects effectively stalled pending the outcome of the fast-track review. It has also led some stakeholders to consider potential legal challenge should the proposals proceed.

As well as looking at the solar PV market, the consultation also seeks views on proposals to increase tariffs for farm–scale anaerobic digestion facilities of up to 500kW. The proposals are made on the basis that current tariffs are not felt to be high enough to make these schemes worthwhile. Views are also invited (by 12 April 2011) on the scope of the comprehensive review of FITs announced in February and due to be completed by the end of the year.

The consultation remains open until 6 May 2011 with the Government proposing that, subject to the outcome of the consultation, any tariff changes will be made in July 2011 and will apply to all new entrants to the FIT scheme from 1 August 2011 onwards.

Wragge & Co's energy specialists examine the proposals being discussed in further detail.


Key Contact

Derek Goodban, partner, +44 (0)121 685 2710, derek_goodban@wragge.com

Gus Wood, director, +44 (0)121 629 1954, gus_wood@wragge.com

This alert may contain information of general interest about current legal issues, but does not give legal advice.

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