Archive for March 2011

Japan, Feed-in Tariffs, and the Rapid Development of Renewables

By Paul Gipe
661 325 9590, 661 472 1657 mobile,

  • Kaneko Masaru: The Plan to Rebuild Japan: When You Can’t Go Back, You Move Forward. Outline of an Environmentally Sound Energy Policy–What is necessary is not restoration but rather reconstruction. At the core of a state reconstruction plan, we need the following shift to environmental energy policies . . . We must have a fundamental transformation to environmental energy policies so as to avoid repeating the tragedy of the foreseeable (and foreseen) massive major earthquake and tsunami. To that end, the Democratic Party is called upon to set up party organizations for quickly institutionalizing the feed-in tariffs . . . and other policies that were part of its 2009 election manifesto. . .
  • Andrew DeWitt: The Earthquake in Japanese Energy Policy–Japan’s [solar PV] FIT is slated to be extended to geothermal, wind, small hydro, and biogas from April of 2012, with a host of restrictions and other limitations that the power elite forced over the objections of experts, local communities and other interests that sought a robust, comprehensive FIT. This crisis affords an opportunity to revisit that just-made decision, stripping the FIT of the imposed handicaps and unleashing it as soon as possible. . .
  • Wind Power secures Electricity Generation in Japan after earthquake, tsunami and nuclear accident–According to data provided by the Japan Wind Power Association, no wind turbine in Japan was damaged by the recent earthquake and by the tsunami. As of the end of 2010, Japan had a total installed wind capacity of 2304 MW, with 1746 wind turbines. . .
  • Craig Morris on Nuclear in Germany: What a difference a decade makes–To anyone who cares to look, Germany demonstrates that a switch to renewables is possible. When Germany decided to replace nuclear with renewables a decade ago, it only had around two percent renewable electricity. Last year, Germany installed an additional one percent of its power supply as photovoltaics alone. The country currently gets more than a sixth of its electricity from renewables. Thanks to feed-in tariffs, the share of renewable electricity is growing by nearly 2 percentage points per year. . .
  • NYT: Japan Orders Nuclear Safety Steps, Plans Energy Review–“As Prime Minister (Naoto) Kan has said in parliamentary debates, I think we should also put emphasis on renewable energy sources, such as solar power,” Trade Minister Banri Kaieda told a news conference. “We should discuss our energy policy as a whole.” . .
  • Post Fukushima Japan: Can Flooding of Nuclear Plants Occur in the US?–The Cooper Nuclear Power Station was built on a 100-year flood plain and first put into operation in July 1974. In mid-July 1993 rapidly rising flood waters on the Missouri River near Brownville, Nebraska forced the operator to shutdown the reactor. The dikes and levees collapsed around the site closing many emergency escape routes in the region. . .
  • Heinrich Böell Foundation: Fukushima: Learning from Experience–The phase-out does not mean that the lights will go out in Germany. On the contrary, the accelerated phase-out of nuclear energy will prepare the ground for increased investment in renewable energies, which are already the technology of the future. . .
  • After the Deluge: Short and Medium-term Impacts of the Reactor Damage Caused by the Japan Earthquake and Tsunami–by the Nautilus Insitute for Security and Sustainability, March 17, 2011 . . .
  • Britian’s Energy Secretary Chris Huhne: Nuclear power may become less attractive option for UK–The Department of Energy and Climate Change has carried out its own projections, which show the UK could – with a massive extra commitment to renewable energy and successful use of carbon capture on a grand scale – meet its target of reducing emissions by 80% by 2050 without nuclear energy. . .
  • After Fukushima: a new dash for gas? Really? by Jérôme Guillet–The final outcome and cost of the nuclear accident at Fukushima are yet to be determined but the obituary of the nuclear industry has already been written, and one competing source of power has already been declared the absolute winner by the Serious People: natural gas. . .
  • Tyler Hamilton: Is Ontario ready for a nuclear disaster?–As Ontario debates the future of renewable energy, questions are raised about the province’s reliance on nuclear power. . .
  • What’s New on Feed-in Tariffs

    • The National: Saudi’s to Launch Solar Feed-in Tariff–The kingdom is expected to announce next week in Riyadh a tariff for solar power, a move calculated to attract experienced renewable energy producers. Such a system could look like feed-in tariffs common in Europe, where government agreements to buy solar power at a set price have helped renewable companies to take off. “The feed-in tariff is the most essential in my opinion,” Dr Alawji said. “Without that we cannot move.”. .
    • Slovenia 2011 FIT Update–By late 2010 Slovenia’s regulatory authority was reporting that the country’s feed-in tariffs had resulted in contracts for 1,100 MW of new renewable energy development, mostly hydro. . .
    • Is Botswana Next to Introduce Feed-in Tariffs?–Camco’s Curren, who has participated in the design of feed-in-tariff regimes in a number of African countries, including South Africa, Uganda and Botswana, says that the high returns likely to be earned by the pioneer investors are arguably appropriate, given the level of risk these investors have taken, which has involved a material amount of predevelopment capital. . . Botswana, for instance, is likely to set a project limit of 5 MW, while the capacity limit for a single project under Uganda’s feed-in tariff is 20 MW. . .
    • Who Invented the Solar FIT?–Or What We Can Learn From Aachen’s Success in Harnessing Clean Energy–The solar industry is booming. During the past decade PV shipments have grown by three orders of magnitude. In 2010 shipments were up over a hundred percent on 2009. How to account for this explosive growth? Though success has a thousand fathers, most analysts agree that the trigger was Germany’s solar feed-in tariff, first enacted in 2000 then turbocharged in 2004. Who deserves the credit for this extraordinarily effective policy mechanism? . .
    • Updated Tables of Feed-In Tariffs Worldwide–Updated solar PV tariffs in Switzerland and Japan, and updated tariffs in Slovenia . . .
    • The Star: Malaysian FIT Program Progressing–“We expect the second and third reading this month … the Act will be enforced probably in May or June, so the feed-in-tariff (FiT) will also come on board then,” says an industry player. . .
    • German Parliament approves adjustment of solar feed-in tariff–Starting July 1, 2011 the feed-in tariff for solar power can be reduced by an additional 3 to 15 percent. This adjustment, however, will only take effect if the deployment of PV capacity this year reaches a correspondingly high level. . .
    • New Record for German Renewable Energy in 2010–As the nuclear reactor accident at the Fukushima Daiichi plant continues to dominate the world’s attention, Germany has quietly broken more renewable energy records. . . The conservative government of Chancellor Angela Merkel, struggling to stay ahead of public attitudes toward nuclear power in the run-up to regional elections, issued its annual report on the contribution of renewable energy to the German energy market in 2010. . .

    The Williamson Act: Agricultural Land Conservation and Solar Development Update

    By Philip L. Millenbah, AICP
    Vice President, Solar Land Partners, Inc.

    The Williamson Act: Agricultural Land Conservation and Solar Development Update

    The California Department of Conservation has issued an updated position paper on the Williamson act called, “Considerations in Citing Solar Facilities on Land Enrolled in the Williamson Act”. This document provides suggestions to cities and counties for permitting solar development on agricultural land under contract in the California Land Conservation Act.

    Among the suggestions made in the paper have to do with solar compatibility to underlying agricultural uses. A positive compatibility determination can be made under the following conditions:

    Certain non‐agricultural uses, including solar power generation, may be compatible with an underlying agricultural use. The Williamson Act provides three general circumstances when a solar power generation facility may be found compatible. First, a solar power generation facility may be a compatible use as an“electrical facility” when located on non‐contracted land within an agricultural preserve. Second, a solar power generation facility on contracted land may be a compatible use if it meets the“principles of compatibility” as set forth in Government Code Section 51238.1(a). Whether a proposed solar installation is compatible with the underlying agricultural use of the land depends almost entirely on the specific circumstances. The statutory test directs cities and counties to look at the degree to which the proposed project would significantly interfere with the underlying agricultural operation. If a proposed solar project would displace or impair only a very small percentage of the current or reasonably foreseeable agricultural operations on the subject contracted parcel or parcels, then the local jurisdiction could find that the solar panels would not reach the level of significant displacement and therefore be an allowed use.

    Finally, under specific circumstances, a solar power generation facility may be approved by a city or county even if it is inconsistent with the principles of compatibility if: (1) the proposed site is located on non‐prime land; (2) the proposed site is approved pursuant to a conditional use permit; and (3) the following four findings are made, based on substantial evidence in the record:

    1) The conditional use permit requires mitigation or avoidance of onsite and offsite impacts to
    agricultural operations.
    2) The productive capability of the subject land has been considered as well as the extent to which the solar power generation facility may displace or impair agricultural operations.
    3) The solar power generation facility is consistent with the purposes of the Williamson Act, to
    preserve agricultural and open‐space land, or supports the continuation of agricultural uses, or the use or conservation of natural resources, on the contracted parcel or on other parcels in the agricultural preserve.
    4) The solar power generation facility does not include a residential subdivision.

    The entire white paper may be downloaded here: “Considerations in Siting Solar Facilities on Land Enrolled in the Williamson Act”.

    By Philip L. Millenbah, AICP
    Vice President, Solar Land Partners, Inc.

    Europe’s FIT Reductions Temper Growth Forecasts For Global PV Demand

    by Solar Industry

    Following very strong growth – 139% – last year, global solar photovoltaic (PV) demand is off to a weak start this year, according to the latest Solarbuzz quarterly report. Preliminary estimates of the first quarter of this year’s (Q1’11) end-market demand in Germany show that levels are running at less than 50% of their Q1’10 levels.

    The gradual price reductions seen so far this year have been insufficient in energizing the market, Solarbuzz says. However, in Q2’11, global demand is still projected to reach 7.4 GW, representing 77% year-over-year growth.

    During Q1’11, module manufacturers have been expanding sales channels, taking on a broader range of smaller distributors and brokers in order to both place increased production volumes and obtain better factory gate prices. As a result, total downstream inventories in Europe – and, to a lesser extent, in the U.S. – have built to unsustainable levels at the end of Q1’11.

    By mid-year, the top five European markets will see feed-in-tariff (FIT) cuts – some as high as 45%. Consequently, Q2’11 demand will be stimulated by the rush to beat mid-year FIT declines, especially in Germany and Italy, Solarbuzz predicts. There will also be steady growth in other European markets, the U.S., Canada, China and India.

    This year, module manufacturers are planning to raise shipments by 55%, while full-year demand is projected to increase by just 12%. After the demand peak in Q2’11, the industry will face an exceptionally challenging second half of 2011 (2H’11) as it addresses a supply/demand imbalance. A period of negative production growth will be necessary to avoid excessive inventory build.

    Any major changes to government PV policies as a consequence of the nuclear disaster that has followed the earthquake and tsunami in Japan are not expected to impact demand until 2012. At the same time, the disaster’s impact on the nine major plants engaged in polysilicon, wafer and cell production in Japan so far appears to be minimal.

    “2011 will be a challenging year for the industry as it manages a slowdown in the market,” says Craig Stevens, president of Solarbuzz. “Europe will not be the growth engine it has been in recent years, and manufacturers will need to access new markets or be exposed to the risk of rising inventories or production cuts during a period of falling prices.”

    By Q4’11, the market share of Chinese, Taiwanese and other rest-of-world producers is projected to increase to 74%, up from 66% in Q4’10. The leading thin film manufacturer, First Solar, and the lowest-cost Asian producers will be the least vulnerable to reductions in shipments during 2H’11, but all manufacturers can expect to face extreme price pressure by the year-end, according to the report.

    Lower-cost Chinese and Taiwanese manufacturers are expected to continue to benefit from an increase in outsourcing of production from the major Japanese and Western solar manufacturers.

    SOURCE: Solarbuzz

    Feed-in tariffs: goverment review risks uncertainty for renewables

    Feed-in tariffs: goverment review risks uncertainty for renewables

    March 28 2011

    Scope of review and key issues
    Tariff bands

    With over 21,000 installations registered, many already view the feed-in tariffs (FIT) scheme for small-scale, low-carbon electricity generation as a success. However, the government is concerned at the high uptake by so-called ‘super-size’ solar installations and wants to find FIT savings in 2014 and 2015. Therefore, on February 7 2011 the secretary of state for energy and climate change announced plans for the first review of the scheme.

    Scope of review and key issues

    The review will assess all aspects of the scheme, including tariff levels and eligible technologies. It will be completed by the end of 2011, with tariffs remaining unchanged until April 2012, unless there is a need for greater urgency. Controversially, there will be a fast-track consideration of solar projects of over 50 kilowatts (kW), with any resulting changes to tariffs to be made as soon as practicable. Many would argue that 50kW is hardly ‘supersize’ – the fast track will capture some solar roof-based schemes, as well as the ground-based solar parks that are within the scope of the scheme, but perhaps should not be.

    The consultation on the fast-track review was formally launched on March 18 2011 – submissions are sought by May 6 2011. As expected, it also looks into the low uptake of FITs by farm-based anaerobic digestion plants. Views are also sought by April 12 2011 on the scope of the comprehensive review of the scheme that the Department for Energy and Climate Change hopes will take place over the summer.

    Solar installations
    The application of the scheme to large-scale photovoltaic installations is being reviewed because the department is worried about the risk of such installations expanding rapidly over the next few years. This, in turn, could have a significant impact on whether the FIT scheme can deliver the savings to which the government is committed under the 2010 spending review, and whether it will work within that review’s spending constraints. The concern is that such installations could draw funding from other technologies and scales of generation, and undermine the value for money of the scheme as a whole.

    Farm-scale anaerobic digestion
    Farm-based anaerobic digestion is being reviewed because it appears that the tariff is not high enough to make such schemes worthwhile, particularly in light of the non-financial barriers arising from the complexity of the technology.

    Tariff bands

    The department intends to change the tariff bands with effect from August 1 2011. It has emphasised that the government will not act retrospectively, and that any changes to generation tariffs implemented as a result of the review will only affect new scheme entrants.

    For large photovoltaic installations, the proposed new bands and tariffs are:

    • £0.19 per kilowatt hour (kWh) for installations of more than 50kW and less than 150kW;
    • £0.15/kWh for installations of more than 150kW and less than 250kW; and
    • £0.085/kWh for installations of more than 250kW and less than 5 megawatts, and for standalone installations.

    The tariff for installations of more than 250kW and standalone installations apparently means that they will benefit from the same rate as more cost-effective renewable technologies, such as wind. This represents a reduction of over 70% from the original tariff bands for standalone installations. The two new bands have been set by adjusting the original FIT modelling in light of evidence of falling costs of solar photovoltaic installations. They also aim to recognise the distinction between very large, industrial-scale solar developments and larger building-integrated systems that could be installed on schools or hospitals, for example.

    For farm-scale anaerobic digestion, the proposed tariffs are £0.14/kWh for installations up to 250kW and £0.13/kWh for installations between 250kWh and 500kWh.


    The department has stressed that changes to generation tariffs will have an impact on new entrants only; installations already accredited will not be affected. However, even before the consultation documents were published, there were concerns that the process would increase uncertainty for those looking to manufacture or invest in larger renewable energy projects, and might even jeopardise the United Kingdom’s chances of meeting its renewable targets. The disappointment already expressed by some potentially affected parties suggests that the publication of the consultation paper has compounded and not allayed these concerns. Indeed, some argue that the band changes will have a retrospective effect in respect of development costs incurred on projects that are no longer economically viable.

    Solar Manufacturers Squeezed By Rising Costs, Falling Prices

    Makers of solar cells are under severe pressure with the spot price of cells at an all-time low at the same time as prices for solar-grade polysilicon and wafers have been increasing.

    The prices charged for solar-grade polysilicon and wafers continued to increase in March 2011. Cuts in subsidy support on January 1 across major European markets, in the form of lower feed-in tariffs for solar electricity, are putting downward pressure on the prices of finished photovoltaic modules. Because of limited supply, the price of silicon is not falling–in fact it is rising.

    The average spot price of polysilicon reached $79/kg in March 2011, according to the latest Bloomberg New Energy Finance Solar Value Chain Index. THat is the hightest price since May 2009 when the Index began. The price of polysilicon in China is higher than in the rest of the world, due to import restrictions and limited domestic supply.

    The price of wafers also increased, with 6″ multicrystalline silicon wafer prices reported at $3.62/piece on average in March, up 3% from February. Multi-crystalline silicon cell prices however were on average at $1.25 per Watt in March 2011, down 9.4% from December 2010.

    The dollar price of modules (or panels) has dropped by almost 7% since December 2010, despite the strengthening euro, the currency of the world’s largest photovoltaic markets. The March results of the Bloomberg New Energy Finance Module Price Index show an average factory gate price across all markets for immediate delivery of $1.88/W for crystalline silicon modules. Although this is down since December, it is above the market’s previous expectations.

    “The global demand for PV modules continues to be very strong, mainly driven by anticipation of further tariff cuts in Italy, Germany, Slovakia and the rest of the European PV markets,” says Martin Simonek, analyst with Bloomberg New Energy Finance. “The first half of 2011 will see relatively small declines in module prices, despite the pressure from developers, because of supply bottlenecks upstream.”

    The data for Bloomberg New Energy Finance’s Solar Value Chain Index and Module Price Index are collected between second and eighth day of each month through a questionnaire sent out to over 120 companies that buy, sell or trade polysilicon, wafers, cells and modules. The monthly results for both surveys are sent to all participating companies on the tenth day of each month.

    Learn more information for investing in solar and other green stocks by subscribing to our acclaimed newsletter, Progressive Investor.

    Source: Sustainable Business

    New Record for German Renewable Energy in 2010

    One-Quarter Million New Solar-Electric Systems Installed

    New World Record: 7,400 MW of Solar Photovoltaics Installed in One Year

    Renewable Electricity Penetration More than 30% of Supply on February 7th

    New Renewables Near 17% of Electricity Supply

    Renewable Generation Greater than Natural Gas–Closing in on Nuclear

    March 24, 2011

    By Paul Gipe

    As the nuclear reactor accident at the Fukushima Daiichi plant continues to dominate the world’s attention, Germany has quietly broken more renewable energy records.

    The conservative government of Chancellor Angela Merkel, struggling to stay ahead of public attitudes toward nuclear power in the run-up to regional elections, issued its annual report on the contribution of renewable energy to the German energy market in 2010.

    Wind turbines, hydroelectric plants, solar cells, and biogas digesters now provide nearly 17% of Germany’s electricity.

    Meanwhile, the German network agency (Bundesnetzagentur) issued its final update on the installation of solar photovoltaics (solar PV) in 2010.

    The results are nothing short of startling and will add fuel to the heated debate about how countries such as Japan can meet their electricity needs without reliance on nuclear power.

    In the immediate aftermath of the Japanese nuclear accident, Germany’s Merkel closed two reactors permanently, and another five temporarily. She also called on her government to revisit its controversial decision to extend the life of its aging reactors.

    The reactors at Fukushima Daiichi are 40 years old and their license to operate had been extended by the Japanese government.

    The reports on the rapid growth of renewable energy in Germany may give Merkel’s government the cover it needs to reverse direction on nuclear power, and by doing so reverse its faltering political fortunes.

    Germany uses an advanced system of feed-in tariffs to pay for renewable energy generation, and has an aggressive target of meeting 39% of its electricity supply with renewable energy by 2020. Its system of advanced renewable tariffs has enabled Germany to exceed its 2010 target of 12.5% by a wide margin.

    New Renewables Near 17% of Electricity Supply in 2010

    The German Ministry for the Environment and Reactor Safety reports that in 2010 renewable energy generated more than 100 TWh (billion kilowatt-hours) of electricity, providing nearly 17% of the 600 TWh of supply.

    Wind turbines and biomass plants delivered more than 70% of renewable generation.

    Biogas plants powered with methane from manure alone generated nearly 13 TWh.

    In 2010 renewables generated more electricity in Germany than gas-fired power plants–nearly as much as hard coal–and are fast approaching the contribution of nuclear power.

    7,400 MW of Solar PV Installed in One Year

    Doubling their previous record, the German solar PV industry installed 7,400 MW from nearly one-quarter million individual systems in 2010, according to the finial report by the Bundesnetzagentur.

    In December alone, Germans installed more than 1,000 MW of solar PV, enough solar capacity to generate 1 TWh of electricity under German conditions. While they represent only half that installed in June 2010, the December installations were 50% greater than total solar PV installed in the USA in 2010 and as much as that rumored to have been installed in Japan last year.

    Nearly 700 MW from some 100,000 systems were installed in a size range typical of that installed by German homeowners.

    An astounding 3,700 MW from more than 135,000 systems were installed in a size range representative of that installed by farmers and other small businesses.

    Another 1,700 MW were installed in a size class characteristic of small businesses and large industrial rooftops.

    Large, multi-megawatt systems comprised 1,400 MW of capacity or nearly one-fifth of total capacity installed in 2010.

    Renewable Electricity More than 30% of Supply on February 7th

    A further sign that renewable energy has come of age as a commercial generating technology, certainly in Germany, is that penetration of wind and solar reached more than 30% of supply on February 7, 2010, according to data posted publicly by Germany’s electricity transmission exchange, EEX.

    The exchange posts online the amount of capacity of conventional generation, wind generation, and solar PV generation delivered to the grid by time of day.

    On Monday, February 7, 2011, the combined real-time wind and solar generation varied from a high of 32% of supply at midnight to a low of 18% of supply at sunrise. Solar PV generation delivered more than 8,000 MW for the two-hour period from just before noon until 2:00 pm, reaching a peak of nearly 8,500 MW at noon. During the same time period, conventional sources contributed 50,000 MW and wind delivered another 10,000 MW to the network.

    There is 16,500 MW of solar PV capacity now on line in Germany. Solar insolation is weakest in mid winter, and highest in mid summer. The solar industry’s February 7th performance bodes well for this coming summer, when solar PV can be expected to break new records.

    In other observations:

    • PV produced 13% of supply at noon on February 7, 2011,
    • Wind reached nearly 1/3 of generation at midnight,
    • Wind and solar’s combined 18,500 MW at noon met 29% of demand,
    • PV was producing 1/2 of its nameplate in mid winter, and
    • Wind was producing near its total installed capacity.

    With the Japanese nuclear calamity fresh in everyone’s mind and upcoming elections staring the government in the face, the success of Germany’s rapid development of renewable energy may give Chancellor Merkel’s conservative government the flexibility it needs to weather the nuclear crisis. It would not be surprising to find the government proposing an even more aggressive pace of renewable energy development than that seen in 2010.


    This feed-in tariff news update is partially supported by An Environmental Trust and David Blittersdorf in cooperation with the Institute for Local Self-Reliance. The views expressed are those of Paul Gipe and are not necessarily those of the sponsors.

    Paul Gipe
    661 325 9590, 661 472 1657 mobile,

    Ontario’s Solar PV Installations May Surpass California in 2011

    by Paul Gipe

    March 22, 2011

    If ClearSky Advisors’ forecast is correct, Ontario may become the leading market for solar PV in North America in 2011.

    The summary of the forecast, one of a series on the Ontario solar market by ClearSky Advisors, will turn heads in the solar PV world.

    ClearSky Advisors forecasts that Ontario will install more than 400 MW of solar PV in 2011. This would be nearly double that installed by California in 2010, presently the largest North American market for solar PV.

    California has more than three times the population of Ontario, Canada.

    With contracts on the books, Ontario is expected to reach 2,650 MW of solar PV by 2015. For comparison, the USA has installed slightly more than 2,000 MW of solar PV during the past thirty years. California has installed half of that amount.

    Of the more than 30 module manufacturers ClearSky has been tracking, 17 to 24 are expected to become compliant with Ontario’s domestic content rules by the end of the year.

    More from ClearSky Advisors.

    Free Registration – Meet the Solar Industry at Intersolar North America 2011

    Dear Solar Professional,

    We would like to cordially invite you to attend North America’s premier exhibition and conference for the solar industry. Take advantage of complimentary visitor registration, today!

    Visitor Registration is free until April 25. Register Now!
    Conference program registration will be available in April 2011.

    Below, you will find detailed information about the various programs and services available to our visitors. Join us this July in San Francisco and meet with the international solar industry!

    Your Intersolar North America Team

    About Intersolar North America

    Intersolar North America’s rapid growth over the past three years underscores the exhibition’s status as North America’s global industry hub for photovoltaics and solar thermal technology. In 2011, Intersolar North America will be the largest solar exhibition in California — the primary U.S. solar market. Over 22,000 visitors and 800 exhibitors are expected at the exhibition,
    co-located with SEMICON West.

    The comprehensive, accompanying conference will provide vital industry information to 1,600 expected attendees. Intersolar North America takes place from July 12 to 14 at the Moscone Center in San Francisco and is the North American solar industry’s best opportunity to develop business opportunities and network internationally.

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    UK reduces green energy payments in Feed-in Tariff scheme

    by ClickGreen staff. Published Fri 18 Mar 2011 12:41

    The UK Government has announced a series of cuts to the financial support available to larger scale sources of solar-produced electricity.

    The proposals have been published as part of plans to protect the ongoing green energy cash payments for microgenerators in homes, communities and small businesses.

    The consultation follows the launch last month of a fast-track review into how the Feed-in Tariffs (FITs) work for solar photovoltaic (PV) over 50 kW after evidence showing that there could already be 169 MW of large scale solar capacity in the planning system – equivalent to funding solar panels on the roofs of around 50,000 homes if tariffs are left unchanged.

    The Department for Energy and Climate Change says such projects could potentially soak up the subsidy that would otherwise go to smaller renewable schemes or other technologies such as wind, hydro and anaerobic digestion.

    Projections at the start of the scheme had shown no large scale solar under the FITs was expected until at least 2013.

    Today’s consultation also covers proposals to provide added support to farm-scale anaerobic digestion given the disappointing uptake of such technologies to date.

    Greg Barker, Climate Change Minister said: “Our cash for green electricity scheme is a great way to reward homes, communities and small businesses that produce their own renewable power.

    “I’m committed to an ambitious roll out of microgeneration technologies as part of the Coalition’s green vision of a much more decentralised energy economy.

    “I want to make sure that we capture the benefits of fast falling costs in solar technology to allow even more homes to benefit from feed in tariffs, rather than see that money go in bumper profits to a small number of big investors.

    “These proposals aim to rebalance the scheme and put a stop to the threat of larger-scale solar soaking up the cash. The FITs scheme was never designed to be a profit generator for big business and financiers.

    “Britain’s solar industry is a vital part of our renewables future and our growing green economy. The new tariff rates we’re putting forward today for consultation will provide a level of support for all solar PV and ensure a sustained growth path for industry.

    “Taking a pro-active approach to changing tariffs will allow us to avoid the boom-and-bust approach we have seen in other countries and enable us to support more homes and community schemes, and a wider range of technologies such as wind, hydro and anaerobic digestion.”

    As solar PV technology has developed, its costs have reduced, and are now believed to be around 30% lower than originally projected. This means the technology does not need as much support to be competitive.

    The Government is therefore proposing reducing the support for all new PV installations larger than microgeneration size (50kW) and stand alone installations. The new proposed rates are:

    * 19p/kWh for 50kW to 150kW

    * 15p/kWh for 150kW to 250kW

    * 8.5p/kWh for 250kW to 5MW and stand-alone installations

    These compare with the tariffs that would otherwise apply from 1 April of:

    * 32.9p/kWh for 10kw to 100kw

    * 30.7p/kWh for 100kw to 5MW and stand-alone installations

    The government says these changes are in line with amendments made to similar schemes in Europe where in Germany, France and Spain tariffs for PV have been reduced sharply over the past year.

    Alongside the fast-track review of solar, a short study has also been undertaken into the lack of uptake of FITs for farm-scale anaerobic digestion. The study suggests that the tariff for this technology is not high enough to make such schemes worthwhile. The proposed new tariffs are:

    * 14p/kWh for AD installations with a total installed capacity of up to 250 kW

    * 13p/kWh for AD installations with a total installed capacity of between 250 kW and 500 kW

    These compare with the tariffs that would otherwise apply from 1 April of 12.1p/kWh for AD up to 500 kW.

    Government policy is specifically to deliver an increase in energy from waste through anaerobic digestion, not to promote energy crops, particularly where these are grown to the exclusion of food producing crops. DECC says it is in talks to Defra and others about the best way to implement controls to make sure this does not happen.

    The Government will not act retrospectively and any changes to generation tariffs implemented as a result of the review will only affect new entrants into the FITs scheme. Installations which are already accredited for FITs will not be affected. Solar PV installations less than 50kW are not affected by this fast track review.

    These changes are proposed to be implemented in advance of the comprehensive review of FITs, which is currently underway and will look at all aspects of the scheme.

    Government unveils deep cuts to Feed-in Tariff

    Greenwise Staff
    18th March 2011
    Energy minister Greg Barker published proposals today to reduce the financial support for larger-scale solar installations under the Feed-in Tariff (FiT) scheme, which if adopted will see tariffs slashed by as much as 70 per cent.

    The cuts, which will not be applied retrospectively, will affect solar projects over 50 kilowatt (kW) and will mean medium-sized solar installations (100 kW) could see incentives cut by more than 40 per cent while the very biggest under the FiT scheme will see subsidies slashed by more than 70 per cent.

    Solar industry furyThe cuts had been expected ever since the Government’s announcement in February that it was launching a fast-track review into 50 kW solar. But the size of today’s cuts has taken industry by surprise. Today, the solar industry reacted furiously, describing the cuts as “horrendous” and marking the death-knell for the UK’s fledgling photovoltaic (PV) sector.

    “This is far worse than anticipated. This industry has been strangled at birth,” said Ray Noble, the Renewable Energy Association’s (REA) PV specialist.

    Proposed tariffs

    Under the proposals, solar installations with a capacity of between 50 kW and 150 kW will receive 19 pence per kilowatt hour (p/kWh) through the FiT scheme. Installations with a capacity of between 150 kW and 250 kW will receive 15 p/kWh, while those of between 250 kW and 5 MW will receive 8.5 kWh. This compares to tariffs of 32.9 p/kWh for installation of between 10 kW and 100 kW and 30.7 p/kWh for those between 100 kW and 5 MW, which were due to come into effect from this April.
    The Government said it was launching the consultation following evidence that showed larger scale solar projects could potentially soak up the subsidy that would otherwise go to smaller renewable schemes or other technologies such as wind, hydro and anerobic digestion (AD). Today it said, there could already be 169 MW of large scale solar capacity in the planning system – equivalent to funding solar panels on the roofs of around 50,000 homes if tariffs are left unchanged.

    “The FITs scheme has been a success since its launch in April 2010 with over 27,000 FITs installations registered to date,” said Barker, but he added: “The projections for take up of FITs published by the previous Government failed to anticipate any large or small scale non-domestic solar PV installations until 2013. These projections have clearly proved to be flawed. Current market indications are that a rapid increase in the number of larger solar installations entering the scheme could distort funding for smaller and domestic scale installations as well as other technologies.”

    But the REA said the Government’s actions demonstrated that it had not understood the PV sector’s potential.

    “Larger PV projects are cheaper, and have a major role in driving down costs. We don’t want boom and bust in this sector either, but pulling the rug out from under the feet of those that have ventured into this market was precisely the wrong response. The UK will return to the solar slow-lane,” said Gaynor Hartnell, chief executive of the REA.

    Before the announcement of the review, the REA estimated that 17,000 new solar jobs would be created by the end of 2011.
    Anaerobic digestion
    Today, the Government also announced that it was seeking views on proposals to changes tariffs for farm scale anaerobic digestion (AD) of up to 500 kilowatts.
    “The current tariff levels have failed to spur a meaningful uptake for anaerobic digestion which means that this technology is not fulfilling its potential contribution to our energy mix,” said Barker.
    The consultation on the proposed tariffs will run until May 6 2011, with the aim of introducing the changes from August 1 2011.