Ditching Feed in Tariffs is Premature: Demand Energy Minister Change Course
by Will Cottrell, Chairman, Brighton Energy Coop | Nov 25, 2018 | Blog
There's little time left before the end of the feed in tariffs scheme. And here's the straight truth: scrapping feed in tariffs in March will bring UK solar to a juddering halt.
That's why I'm asking you to write to your MP. Tell them that instead of binning FITs, Energy Minister Claire Perry must give solar a fair deal. Ending Feed in Tariffs is premature, and it's time the government listened to economic sense.
Solar is nearly viable without Feed in Tariffs
A few months ago Minister Perry told fracking companies that the criteria for judging their success, from her point of view, would be a "line of sight to commerciality".
Well: if Perry's ultimate goal is commercial viablity (and let's park the fracking debate for a moment), then solar is clearly about to meet that criteria. For domestic homes, FITs have already fallen from 40p per kWh in 2012 to just 3p today.
Indeed, if cost is your bottom line, solar is on the cusp of something big (if you're interested this phenomena has everything to do with something called Swanson's Law).
Ending Feed in Tariffs is premature
Solar is nearly at what's known as 'grid parity' – the point where the market price of electricity is enough to support the commercial viability of solar – subsidy free. But we are not quite there yet. The complete removal of FITs will make this all but impossible.
This should already be obvious. No-one, for example, has built a solar farm for the past two years since subsidies for that size of system were ended (the two that have been built are exceptional circumstances).
With the ditching of Feed in tariffs, roof-based solar installations will soon go the same way. Already barely anyone is building new solar PV, as government figures show. Between April and June, for example, just 1000 solar systems were built in the UK, representing roughly 0.1% of the total number of installations countrywide. This is the slowest pace of installation since 2011.
The ending of FITs will just make this worse.
And yet subsidy-free solar will be a reality within a few years. Solar farms are expected to be built without subsidy next year. And prices of solar panels are tumbling – down 25% this year already.
Installations on domestic and larger buildings will take longer to be commercially viable, but this will probably happen the year after.
Controversial as it may sound, binning solar subsidies is a worthy ambition. FITs, after all, were conceived as a self-negating support. But the timing of their removal is equally important. March is clearly premature: we need FITs for a year or two longer.
Demand Minister Perry take action
The Energy Minister is already alert that the government's proposals to end the FIT scheme are unfair. Last week in parliament she signalled that one aspect of the proposals – the end to the export tariff – were being reviewed.
Now we need to demand that the minister postpone the end of the Feed in Tariff scheme.
So: please write to your MPs; and let Minister Perry know that the end of the FIT in March 2019 is rash. The way to bring about the commercial viability of solar (and hence assist in the transition to a green economy) is not to end support prematurely – it's to support it until grid parity. Only at that point is the decision to end FITs justified.