Feed-in tariffs in danger of being watered down

Feed-in tariffs in danger of being watered down

Ecologist

30th November, 2009

Campaigners say the Government is underestimating the potential of small-scale renewable electricity generation in the UK

The UK could generate 6 per cent of its electricity from feed-in tariffs with minimal additional cost to household energy bills, say campaigners.

According to the Government’s own figures, doubling the annual return on offer for small-scale renewable energy producers would add just £2.37 a year to household bills.

The returns are part of proposals to incentivise renewable energy production. So called feed-in-tariffs, due to be introduced by April 2010, will pay households and businesses an above-market rate for every unit of electricity they generate and feed back to the national grid.

Germany’s success

Germany in particular has had significant success with feed-in-tariffs with more than 130,000 homes being fitted with solar panels every year.

Friends of the Earth has criticised the current proposals on offer from the Department for Energy and Climate Change (DECC) for only aiming to generate 2 per cent of UK electricity from small-scale renewable technologies by 2020.

DECC research

The group says DECC is ignoring the results of its own research that showed setting the feed-in-tariffs to deliver a 10 per cent annual return on investment instead of the 5-8 per cent currently proposed would triple the Government’s current 2 per cent target.

It would also add an average of £2.37 per year to household electricity bills over the next four years – just £1.20 a year more than the addition currently proposed.

Kick-start

A coalition of groups, including the TUC, British Retail Consortium and Federation of Small Businesses have written to MPs urging them to support calls for DECC to improve the incentives for renewable electricity generation.

‘A tiny addition to UK electricity bills would kick-start a world class scheme that would allow homes, businesses and communities to play their part in tackling climate change, increasing energy security and creating thousands of new green jobs,’ said Friends of the Earth’s energy campaigner Dave Timms.

‘The UK’s renewable energy potential is enormous. As the world prepares for crucial climate talks in Copenhagen, the Government must show that it is taking this issue seriously and improve its plans to pay people for generating their own clean, green power.’

DECC said it will make a decision on feed-in tariffs early next year, ahead of its own deadline for introducing them of April 2010.

Useful links
DECC position on Feed-in-tariffs

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