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As expected, the feed in tariff was slashed by Amber Rudd this week, albeit not quite as bad as expected - [i]only[/i] 65% rather than the expected 90%.
I was looking at installing PV this year but doubts over whether we'll stay in the house long enough to see payback (plus the financial concerns associated with a new baby) put me off. Now I wish I'd done it in time to get the full FiT benefit and would still do it for the free & clean energy of it. So I'm hoping it means more competitive prices upfront.
Anyone have any insight into the industry? Is this likely to reduce upfront costs to remain a viable option for the energy consumer, or just kill off the industry?
Effect - 1000 jobs lost...
Not sure where I stand on this - on one hand the uptake of solar can only be a good thing, especially if the Tesla PowerPack products take-off.
On the other hand, the only people I've seen install them are those wealthy enough to pay in full for them. I'm not sure I should be subsidising their 'cheap' energy, so they make a quicker return on their investment.
My neighbour installed them a few years ago.
When he explained the financial benefits, I said that it was a wonderful policy of taking money off poor taxpayers and giving it to rich ones instead...
So what is the return on investment likely to be now then? We have a large section of south facing roof, so it's something I wonder about doing.
IHN - your best bet is to contact a local reputable installer and ask. They will survey your location for free, and should give you a spreadsheet showing the likely financial return.
Lots of energy sources are or have been subsidised by the taxpayer. For example, nuclear has had huge amounts of state subsidy over the last fifty years. With 500K+ domestic solar installations in the UK, at least some of the benefits are being shared around this time.
We have a modest terrace house with solar panels on. We bought them instead of a car. Appreciate that's not an option for everyone - but they are hardly only for the already well off.
As for the industry, as usual, the UK will miss a trick in exploiting a technology which is on the brink of becoming mainstream for what looks like ideological short sighted reasons. By 2020 (ish) though, it'll be able to stand on its own two feet without any subsidy.
Lots of energy sources are or have been subsidised by the taxpayer. For example, nuclear has had huge amounts of state subsidy over the last fifty years. With 500K+ domestic solar installations in the UK, at least some of the benefits are being shared around this time.
Big difference between taxpayers contributing towards guaranteed shared supply, and me paying you to get a 10% return on your capital, with dis-benefits to the rest of the population in terms of security of supply.
As for the industry, as usual, the UK will miss a trick in exploiting a technology which is on the brink of becoming mainstream for what looks like ideological short sighted reasons. By 2020 (ish) though, it'll be able to stand on its own two feet without any subsidy.
Don't agree here either - exactly what technology will we exclude ourselves from here? The panels are all made abroad and always will be, the networks are installing smart meters etc anyway, and the jobs in the industry are (mostly) fake because they need the government kick back.
The decision to reduce the subsidy makes sense from an economic perspective (panels are much cheaper now), and even from a social justice perspective (unusually).
Anyway - interested to know what the new rates of return/payback periods are!
Until the panels get a lot cheaper the payback periods are going to be too long for most adults/mortals to consider them an investment.
Don't think anyone's disagreeing on the need to taper off the subsidy (as the Govt. has been doing already) - just the steepness of this latest reduction.
If other people getting a return bothers, then anyone with a few quid has been able to invest via schemes like Abundance etc.
We all benefit from more solar on the grid and it is a valid part of the mix to improve security of supply. Even the Govt has said it wants a solar revolution in the UK.
The latest cuts, together with others, all contribute to sending industry mixed messages about whether it's worth investing in green tech - either implementation, manufacture or R&D - in the UK. Business typically doesn't like that kind of uncertainty so will invest elsewhere where the Govt is judged as more consistent.
We had a bloke come round a couple of months ago to quote us for a system.
His price was very high but did include micro-inverters on each panel which have a couple of advantages over one inverter.
Pay back time for the system was looking to be realistically around 10 years. And by that time he reckoned that the inverters might be starting to fail, which were of course covered by their guarantee and would be replaced FOC (because of course they will still be trading under the same name in 10 years).
It seemed to me that if you wanted to do it for environmental reasons, it would be worth doing. But, if you expected to make money out of it, forget it. That may have been the case when the feed-in tariffs were 40p+, but this quote was prior to the most recent cut & the numbers just didn't seem to add up.
Why would you ever invest, I couldn't see past investing a huge amount of cash in an asset that depreciates to £0 the moment it is installed!
That and has anyone ever sold a house with a Solar PV install, I reckon most just look at it and say uh-oh someone else owns the roof.
All that before I even start to work out the impact on my bill reduction and the amount I would make with FIT
greencat - MemberEven the Govt has said it wants a solar revolution in the UK.
Well it's on their daily goals list. After they abolish poverty and learn portuguese
Yes, it's certainly not a licence to print money (it wasn't even when I installed mine a couple of years back). The way I see it is as it's a chance to pre-buy xxx kWh of electricity at a fixed price for the next 20 odd years and be less at the mercy of the energy companies.
"That and has anyone ever sold a house with a Solar PV install, I reckon most just look at it and say uh-oh someone else owns the roof."
Only if you cheap out and rent to someone else......
pretty sure samuri fell over him self a few years back to buy a house with a propper install solar pv install.
I know someone how did this a few years ago and got the max tariff, however back then he paid £12k and I think typical installations have dropped to around £5k, so I think it is right the tariffs should come down.
We all benefit from more solar on the grid
Not if all the benefits go to the householders. Solar does nothing for security of supply. The output is zero on winter evenings when demand is highest. During winter when gas supplies are most likely to be under pressure solar produces next to nothing. In January 2014 solar produced 0.19% of UK demand.
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http://euanmearns.com/uk-solar-pv-vital-statistics/
Are the commercial operators rates being slashed as well?
I've seen loads of PV farms popping up all over the place lately where working farm land used to be, so I assumed they are must be pretty lucrative.
FiT are paid by energy customers, so its effectively a tax on the poor and profit for the rich. It has brought down installation costs but I'd guess the pay back is now measured in decades.
FiT are paid by energy customers, so its effectively a tax on the poor and profit for the rich. It has brought down installation costs but I'd guess the pay back is now measured in decades.
So we can all expect to see a reduction in our bills now?
It has brought down installation costs but I'd guess the pay back is now measured in decades.
Still attractive, plenty of big players are still moving ahead with projects, the rent a roof stuff is more difficult/impossible because lots of small installations are much less efficient to set up. Panel prices have fallen massively and are now essentially commoditized. It will be one factor that will reduce bills, but when looking at what is happening in the energy markets generally, a small one.
Yes, subsidies being slashed for everyone. The reason you are seeing so many being thrown up hastily is because everyone is getting their installs done while they can still register for the higher rates.Are the commercial operators rates being slashed as well?I've seen loads of PV farms popping up all over the place lately where working farm land used to be, so I assumed they are must be pretty lucrative.
mudmuncher - MemberI know someone how did this a few years ago and got the max tariff, however back then he paid £12k and I think typical installations have dropped to around £5k, so I think it is right the tariffs should come down.
That's what we were quoted (£12k) for the largest install they could do - 8kw, I think.
He tried to make out that a lot of the extra cost over other systems I may have seen (seen them advertised for ~£8k) would be due to the superior inverter technology they were using.
Apparently a micro inverter on each panel means each panel will be able to output as much as it can, whereas if you only have one inverter for the whole lot then the output gets throttled back to the lowest output panel - e.g. the one half covered in bird crap, or in the shadow of a tree for half the day.
FiT are paid by energy customers, so its effectively a tax on the poor and profit for the rich
You realise you're misguided in your citizen smith outrage here.
It's commercial electricity contracts that cover the FiT, not domestic.
There's no government subsidy for the FiT, the govt don't even do much of the admin on it, that's down to the supplier who the PV owner has signed up with.
The way the scheme was set up was to incentivise the PV industry, ramp up installations and lower costs. The FiT was supposed to incrementally tail off over time to balance out between lower install costs. By dropping the FiT off a cliff the industry can't sustain itself as it's still not mature. In the meantime as someone who manages a few £million in electricity accounts i'll still see FiT charges coming on our bills and i bet they still keep rising as there's no regulation in place to limit what we can be charged
FiT charges coming on our bills and i bet they still keep rising as there's no regulation in place to limit what we can be charged
You will have them for 20 years because that is how long the tariff lasts. They will also go up because they are indexed.
You will have them for 20 years because that is how long the tariff lasts. They will also go up because they are indexed.
They've increased beyond index because it's also based upon the amount of FiT obligations the suppliers have. The FiT was designed so that the suppliers were able to pass all costs back on to their commercial contracts
The obligation had not upper limit, if you connected at the time of a particular tariff, you received it no matter how many other schemes had already gone through that year.
You realise you're misguided in your citizen smith outrage here.It's commercial electricity contracts that cover the FiT, not domestic.
And where do the electricity companies get their money from.
Third party chargesOn your electricity invoice, you’ll see a section labelled ‘other charges’. This includes any elements of your contract which are ‘passed through’. A 'pass through' charge is one that is levied by a third party (e.g. the Government), which we have to pass on to you - our customer.
Some of the charges you may find in the ‘other charges’ section of your invoice include the third party costs for the investment in future and continuing electricity generation - such as Renewables Obligation (RO) Charge, Feed in Tariff (FiT)
The suppliers pass on the cost of the Feed-In Tariffs scheme to all their electricity customers.
http://www.fitariffs.co.uk/FITs/principles/funding/
Costs for the programme will be borne by all British electricity consumers proportionally: all consumers will bear a slight increase in their annual bill,
https://en.wikipedia.org/wiki/Feed-in_tariffs_in_the_United_Kingdom