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Blueprint for feed-in tariffs proposed by industry

The renewable energy industry presented its proposals for how feed-in tariffs could best be introduced to energy minister Mike O’Brien last week. Last year’s Energy Act outlined plans for a feed-in tariff to pay microgenerators for the electricity and heat that they produce from April 2010. The blueprint developed by the Renewable Energy Association (REA) with the input of 60 representatives from the industry calls for the government to incorporate the following:

  • That tariffs cover renewable heat and renewable gas, as well as renewable power (electricity) up to 5MW
  • Owners are paid for all the renewable energy they produce whether they export it to the grid or use it on-site
  • The payment varies by technology so that all renewable resources can make a contribution
  • The tariffs should work for smaller (household) and larger (community and commercial) generators
  • ‘Smart metering’ is encouraged under the scheme
  • The administration of the scheme is simple and not bureaucratic so that householders find it attractive and easy to use

REA is also calling for the government to bring the introduction of feed-in tariffs forward, and that the government states clearly, and as soon as possible, whether (and how) any systems installed between now and the introduction of the tariffs will be eligible to receive them.

There is considerable concern (as mentioned by Matthew Rhodes in his blog last week) that because the community section of the Low Carbon Buildings Programmes has run out of funds for PV grants before the beginning of feed-in tariffs, and lack of clarity about whether installations made now will be eligible for the feed-in tariff, people will wait to install microgeneration or renewable energy until the tariff is introduced. This will create problems for many of the businesses in the sector. Rather than building up capacity, so that it can supply the increased demand that is likely with feed-in tariffs, it’s likely that lots of companies will go out of business waiting for it to arrive.

REA estimates that the tariff scheme, which will be paid for by a supplement on all energy bills, will lead to a price increase of less than 1 per cent in the first year, rising to just under 4 per cent in 2020. By then renewables under the scheme are expected to contribute 10 per cent of the UK’s total heat and power.

The full preliminary blueprint document is available to download.

photo by K/pi

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