REA Reaction to DECC FIT Review Announcement

The REA has over 650 member companies, 165 of which are from the PV industry.  It also has a Biogas Group, and represents the Anaerobic Digestion sector.

The Feed-in Tariff review announced by DECC this morning creates massive uncertainty for all PV projects over 50kW. A wide range of schemes including those planned for schools, hospitals, and community’s look set to be caught up in the 'fast track' for review, with changes to be implemented 'as soon as possible'.

Gaynor Hartnell said;

"Developers of PV installations upwards of 50kW, will be left hanging in the air.  Bands up to 4kW can be more confident Tariff levels will remain unchanged until April next year – but developers of schemes from 10kW to 50kW in particular will be wondering how the announcement applies to them.  DECC expresses concern about field arrays but it is fast-tracking far more than the stand-alone field arrays.  In our view this has escalated the uncertainty." 

"As DECC’s announcement points out, the scheme has been a great success so far. Constraining it goes against the growth agenda.  Non-domestic and community schemes have a vital role to play in the cost-effective and sensible development of the UK PV industry.  Many investors stand to lose out. I fear this announcement reflects the generally poor levels of ambition for PV in the UK and will adversely affect our ability to attract much needed future investment in other low carbon technologies."

In summary 

REA welcomes:

  • The first step in a process which should ultimately end uncertainty.
  • The stated intention to provide investor certainty.
  • DECC’s acknowledgement that the PV FIT scheme is creating huge growth in jobs.
  • A process for increasing the tariffs for farm-scale biogas plants, which the REA has been pressing for.

REA’s Biogas Adviser David Collins said; “The announcement by government that it is reviewing the levels of FIT for farm AD is hugely welcomed.   This sector has a vital role in meeting renewables targets and reducing emissions - and an expansion in biogas plants will contribute to farm profitability, job creation and the local community."

REA concerns:

  • The comprehensive nature of the review creates widespread uncertainty.
  • The potential for stranded investment.
  • A failure to appreciate the importance of non-domestic and community-scale schemes in the UK PV sector despite the Microgeneration Consultation, and Coalition Document’s emphasis on community-scaled schemes.
  • Very low levels of ambition for PV which puts the UK far behind other major EU countries.
  • No clear strategy to reach grid parity for solar PV in the UK.

Gaynor Hartnell said; "REA recently put out research showing the PV industry will create 17,000 new jobs during this year and since the start of the scheme.  This announcement will inevitably undermine prospect for employment growth.  DECC must develop a bigger vision for what this technology can deliver, as the UK is falling far behind other major EU countries on its ambition levels.  REA wants to see any review closely examine the huge benefits of a thriving PV industry because when those benefits are fully appreciated it’s obvious the UK should aim to do a lot more with this technology which is booming internationally."

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