PV Solar Panels – FIT cuts, government reviews… still feasible?

PV Solar Panel

PV Solar Panel

In 2011 the commercial and domestic PV solar industry was seen to be a booming, high growth industry and then it all went wrong… After much debate the government dramatically cut feed-in-tariff subsidies, reducing the commercial feasibility of new installations and putting many of the smaller manufacturers and installers out of business.

Since then, there has been a mini revolt, with lobbying on an almost daily basis and much nationwide, negative PR to support the cause.  The Department of Energy and Climate Change (DECC) recent announcement has caused mixed reactions within the industry. Some believe it is a step in the right direction, whilst other feel that their commitment to supporting new renewable cause have wavered somewhat.

Key points from DECC’s announcement:

  • PV solar panels installed after April 1st 2012 will be required to produce an EPC (Energy Performance Certificate) rating of D or higher in order to fully qualify for the complete FIT payback (50% of current installations are D or above).
  • Multi-site installation will remain at 80% of the standard tariffs based on the reduced costs of installations. However the categorisation for multi-site has changed from over 1 installation to over 25.

Greg Barker, UK Climate Change Minister states, “Our new plans will see nearly two and a half times more installations than originally projected by 2015 which is good news for the sustainable growth of the industry. We are proposing a more predictable and transparent scheme as the costs of technologies fall, ensuring a long-term, predictable rate of return that will closely track the changes in price and deployment”. He continues, “I want to see a bright and vibrant future for small scale renewables in the UK and allow each of the technologies to reach their potential where they can stand on their own two feet without the need for subsidy”.

In essence, the payback on installing PV solar panels may not be as lucrative as it once was, however given the boom in 2011 it simply wasn’t feasible for the government to subsidise all these installations. Economies of scale mean the cost of producing PV Solar Panels is at an all time low as, the take up on new installations is still growing at a considerable rate showing that there still is money to be saved from the feed-in-tariffs.  Yes, PV Solar Panels might not be as lucrative as they once were, however they still provides a positive payback and enables you to your bit for the UK’s Micro-renewable sector.