Reductions to FIT

So February 8 is D Day

The Department of Energy and Climate Change (DECC) has softened plans to slash support for domestic solar and wind power schemes, after more than 100,000 people around the world raised concerns that the popular feed-in tariff scheme was poised to close.

In a document published this morning, the government confirmed small scale renewables will still see deep cuts, with solar feed-in tariffs falling by as much as 63.5 per cent from 8 February.

DECC confirmed it would cap annual new spending for the feed-in tariff at 100m by the end of 2018/19 as set out in the consultation. However, it said new evidence which came forward during the consultation period has allowed it to reduce the severity of planned cuts.

In a surprise move, the government also announced it would reintroduce pre-accreditation for solar PV and wind generators over 50kW, as well as all hydro and anaerobic digestion plants, after scrapping the mechanism in September.

The government said it had made the changes after listening to feedback from the public and industry.

"My priority is to ensure energy bills for hardworking families and businesses are kept as low as possible whilst ensuring there is a sensible level of support for low carbon technologies that represent value for money," said Energy and Climate Change Secretary Amber Rudd in a statement.

"We have to get the balance right and I am clear that subsidies should be temporary, not part of a permanent business model. When the cost of technologies come down, so should the consumer-funded support."

DECC also confirmed separately today that it will end support for all new solar farms supported through the Renewables Obligation scheme from 1 April 2016, including installations smaller than 5MW in capacity as part of its drive to trim consumer spending on renewable energy.

The feed-in tariff outcome today confirmed sub 10kW solar schemes will see payments fall by 63.5 per cent instead of the 87 per cent cut proposed in the original August consultation proposals, which industry insiders had predicted would mark the demise of the sector in the UK.

DECC said sub-10kW solar schemes will now receive 4.39 pence per kilowatt hour (kWh) in February instead of 12.03p/kWh under the current scheme.

PV systems with a capacity of 10-50kW will see their tariffs fall by nearly 58 per cent to 4.59p/kWh instead of 10.90p/kWh under the current policy.

However, despite the improvements announced today, the government's own impact assessment predicts that between 9,700 and 18,700 solar jobs could be lost as a result of the changes.