Changes to Fit -in Tariffs casts shadow on solar PV industry

Earlier this evening I seconded a motion, proposed by Cllr Catherine Dawson of Mincinglake condeming the Conservative/LibDem coalition governments sham consultatioj over the rushed plans to change the level of Feed-In Tariff payment to those installing solar PV panels on their roofs.

Announced at the end of October, the changes came into effect yesterday, 10 days before the end of a consultation on the matter.

The motion:
This Council calls on the Government to reverse its cruel cuts to the tariff which will harm a lot of residents in Exeter.

They are planning to cut the tariff for solar PV installations with a capacity of 4KW or less by more than 50% from 43p/kWh to 21p/kWh. For multiple installations the rate falls to 16.8p/kWh.

Their rushed cuts to the Feed in tariff for solar PV goes too far, too fast, hits families trying to protect themselves from soaring energy bills, put thousands of jobs and businesses in the solar industry in jeopardy and give lie to the government’s promise to be the “greenest government ever”

My speech seconding the motion:
My Lord Mayor

As a long-time supporter of Green causes, it gives me great pleasure to second this resolution.

And I’m pleased that this is on a day when there are protests outside Parliament asking the Government to Cut Not Kill the solar power industry and two days before a legal challenge to the changes

But first I must declare a couple of interests. 

Earlier in the year, SunGift Solar installed a Solar PV system on our roof and it’s currently generating electricity.

I’d like to thank Sungift Solar for honouring their pledge to put up Exeter’s Christmas lights for free.

The change in payments under the FiT scheme has meant they’ve been extremely busy, trying to install 6 months’ worth of orders [some 50 systems or so] in 6 weeks.

I am also a member of the Labour Party – the Party that in April 2010 introduced the Feed-In Tariff scheme [which is commonly shortened to FiT]

The FiT scheme is a process used by over 40 countries around the world that pays people to generate electricity from solar photovoltaic [PV] panels funded by a small levy on all energy bills

When the FiT was introduced by Labour in April last year, the Uk belatedly joined the party in one of the fastest growing markets of any kind globally.

The Feed-in Tariff certainly isn’t perfect, but it’s been incredibly successful at getting panels on roofs.

This doesn’t just help people reduce their electricity bills and carbon emissions – there’s plenty of anecdotal evidence that seeing the panels in action (and reaping the rewards) can change the way people think about energy.

They then are more likely to make climate-friendly choices in other areas of their lives.

Yet back it when it was announced  back in April 2010 it was criticised by the Conservative opposition.

Heavily criticised.

Greg Clark, then Shadow Energy Secretary said:
“FITs are essential to allow decentralised energy to play a major role in our energy mix, but Labour’s proposals today lack ambition. 

“Ministers should have been bolder with this scheme so more jobs could have been created and greater reductions in emissions could have been achieved.”

But even before that, back in 2007, David Cameron welcomed FiT schemes when spoke [on video] to a Greenpeace conference.

Yes he was green. He was extremely green.

He was green with envy of the generous FiT scheme in Germany.

He saw how it was taking British-made technology and putting it on German roofs.

He wanted – and I quote –

“The right plans and the right political will to drive through a mass market for micro-generation”

So here’s a phrase I thought I’d never utter – 


In Opposition, both the Lib-Dems and Tories dismissed the Labour initiative as pitifully unambitious. 

In Government, they pledged to do much more.

The Coalition Agreement even pledged to make FiT the centrepiece of their commitment to ‘community owned renewable energy generation’. 

But you would never guess it now.

So what went wrong?

Were they got at by the Big 6 Energy Companies – and their paid lobbyists?

Did they listen to the Nuclear Industry – and their paid lobbyists?

All I know is that the solar energy industry was too busy putting solar PV panels on people roofs to have time to pay for lobbyists.

I’m proud of my green credentials to add to my socialist beliefs. I’m a Green Red

David seems to have taken his green thoughts, mixed them with his true blue blood and turned yellow.

I’m not criticising him for changing his mind – 
I’m criticising him for changing his mind from being so right to being so wrong.

Let’s look at some figures:

 The UK solar energy industry employs 25,000 professionals compared with just 3,000 in 2010 
 The number of solar businesses has increased from 450 in 2010 to over 3,000 today 
 Since the introduction of tariffs in 2010 a total of 87,769 solar installations have been completed in the UK 

All of which could help the Tory Government meet its claim of being the greenest government yet – and at the same help the private sector create new jobs.

There are even more figures being bandied around about the cost of the FiT scheme.

I believe that might cost each household about £1.50 each year.

Ofgem, the energy regulator, confirms this estimate.

But is only might because other studies say the Treasury gets more back in tax and NI (from the jobs created) than it costs to run the scheme. 

Either way, it is not a sum around which the economy will crumble

Greg Barker, Minister of State for Energy and Climate Change, isn’t sure what it will cost.

Each and every announcement seems to put the cost higher –

First £26, 
Then £28 but its assumed that was a slip of the tongue
Then it went up to £55 and now rests around £80.

However, a figure that can’t be disputed is the one for decommissioning nuclear power stations.

The UK tax payer pays hundreds of times more than this towards the cost of decommissioning nuclear power stations and looking after the nuclear waste they generate.

According to the Government’s own figures, £6.93bn of taxpayers’ money was given to the Nuclear Decommissioning Authority in 2010-2011. 

That figure equates to £260 per household.

We talk about micro-generation but it can generate a lot of electricity

 the energy generation of solar power now exceeds the 225 megawatts maximu operating     capacity of the Oldbury nuclear power plant 

The cuts to the Feed-In Tariff will deprive the UK of a booming green industry that is driving jobs growth and providing an environmentally sustainable and long-term alternative to other fossil-fuel dependent methods of electricity.

Already leading solar firm Carillion has confirmed that some 4,500 jobs are now under threat due to the planned cut to the subsidy.

Indeed the firm that put solar panels on the Kensington roof of the Prime Minister have already laid off 2 workers.

So rashly withdrawing support from this burgeoning industry will be disastrous for both our economy and the environment.

What might not be known is that from the start it was always planned that Feed-in Tariffs were supposed to decrease annually, as the price of technology falls. 

Unlike nuclear, solar does not need subsidising forever.

That was part of attraction. 

There would be staged reductions in in the tariff, down to zero within the decade.

These reductions in tariff were to have been there to fairly reflect falling solar prices, and were planned so as to be not be too deep to stall the development of a domestic UK solar industry.

Cutting so far and so fast as this Government has done will put thousands of solar workers out of a job and pull the rug out from under small community groups that have already poured time and effort into their projects, but don’t stand a chance of meeting the new deadline.

Take Brighton Energy Cooperative, which was due to start selling shares but has been forced to put the entire project on hold until further notice. 

Reading Council announced that they’d be drastically scaling back their school solar programme. 

Even this Council’s own programme for solar PV panels on nearly 500 council homes was in doubt – but thanks to quick negotiations from our officers that one, at least, was rescued

Do these cuts need to happen at all?

Unlike other government programmes, the FiT scheme isn’t funded from general taxation – the costs are covered by a levy on energy bills. 

When the Labour government was designing the scheme, they came up with an estimate of how much it would cost, and planned to revisit this figure once they had some proper take-up data.

When the coalition came into power and kicked off the spending review, they took this estimate, cut it by 10% and set that as the overall budget for the whole programme. 

It’s not clear why the scheme was included in the spending review at all, since it isn’t funded directly by the treasury and doesn’t increase the deficit; but whatever the reason, it means that the whole idea of a Fit ‘budget’ is an invention of this government.

Decisions like this are really just a question of priorities – if a government really wants to do something it wil always find a way of financing it.

But in any case the impact of the Feed-in Tariff is tiny compared to spiraling gas prices and energy companies’ profits 

And even if we rule out any bill increases, there are plenty of other ways to meet the cost – from a direct levy on energy company profits, to reallocating money from other programmes that have underspent. 

Yet it recently emerged that climate minister Chris Huhne never even asked the treasury whether they could provide emergency funding to allow the cuts to be phased in gradually.

The real measure of a government lies in the choices it makes when there’s no easy option. Ministers need to ask themselves: when all is said and done, will these cuts bring us closer to a truly low-carbon economy, or will they push it further over the horizon?

Any government that wants to be remembered as the “greenest ever” must put this question at the heart of every decision, but especially over this particular decision.

I say “From the greenest government ever to the meanest government ever”. 

The co-coalition has done a huge U-turn and is now doing nothing less than demoralizing – and demonizing – the solar power industry as a matter of course.

Over the weekend I was speaking with Caroline Flint, Labour’s Shadow Energy Secretary and we agreed that history will record that Labour began this growth industry and the Tories will all but kill it off in its infancy if these mindless changes to the FiT scheme are not reversed.

It gives me great pleasure to second the resolution

A lively debate followed with the motion falling to a Lib Dem amendment suggesting sending comments from the City Council to the very consultation I believe is a sham – only passed by local Tories and Lib Dems voting together and the casting vote of the Lord Mayor.

For me, the most pleasing comment came from Deputy Leader of the Conservative Group, who commended Labour “Central Office” for supporting us both with all the facts and figures.

No James, that was all our own intelligent factual research! We both hae enquiring minds that we like to put to good use.

E.ON Solar Panels for Council Homes

As soon as Exeter Council Council announced a partnership with E.ON to install solar PV panels of the roofs of ECC housing stock, the Government moved the goalposts.

On 31 October the Government announced that, due to the popularity of the scheme, the feed-in tariff for electricity generated by solar panels will now be cut. Social landlords will feel the brunt of this, with the cut slashing the tariff from 43p per kW/hour down to 16.8p per kW/hour for any schemes which are not complete by 12 December 2011. This FIT payment  is more than a 50% reduction on the  original sum. This comes on top of the predicted cut due to come into force on 1 April 2012.

In light of this, and following on from the email you received last week, the provision of solar panels to Exeter City Council properties is now on hiatus whilst E.ON reviews whether it will now be financially viable to continue.

A meeting between ECC and E.ON to discuss this is due on Thursday with  and we will, of course, update you as soon as we have more information.

There was a fear that the scheme might prove to be no longer viable to provide these panels to the 700 selected properties,  so it is a welcome relief to know that EC have agreed with E.ON to carry on with this project despite the changes to the FIT.

EON will receive 16.8p per kW/hour because this is a social aggregated scheme i.e. it’s being done in bulk. The 21p rate was only for private individuals.

As of today, ECC have over 330 houses out of a possible 480 around the City who have signed their Tenancy Variation Agreements to give E.ON permission to check whether their roof and loft are suitable for solar panels. ECC are also now starting to offer this to around 200 top floor flats.

E.ON should begin to visit everyone who has signed up from 12 December with a view to starting installation in January.

It is worth pointing out here that the FIT rate will not affect tenants in any way. They will still be able to use all free electricity generated during the day from the panels.

The changes will only impact on the amount ECC receive – there will no longer be any income through renting roofs to E.ON. This will mean that the plans to use this income for a programme of energy efficiency and insulation works to those homes which will not benefit from solar PV panels will have to be scrapped.