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Assured Energy Outlook: Issue 23 – August 2018

Support scheme for small-scale renewables set to close, while EIIs gain exemption

A consultation was opened by the government on 19 July on the closure of its Feed-in Tariffs (FiT) scheme. Opened in 2010 the FiT supports small-scale low- carbon technology developments such as sub-5MW solar installations.

The government proposed to close the FiT tariff, which rewards recipients for exporting power back to the grid, alongside the closure of the generation tariff. This would mean full closure of the FiT scheme to new applications after 31 March 2019.

Industry body the Solar Trade Association (STA) criticised the announcement and said that 28,000 businesses and 800,000 households would not be generating solar energy today without the scheme.

A consultation was simultaneously launched on the future for small-scale low-carbon generation. The government’s view is that, where it is beneficial to its objectives and the electricity system, developments should deploy in a system in which “competitive, market-based solutions are brought forward, the private sector can innovate and invest, and where technologies can compete on a level playing field”.

It was also announced that the government intends to bring in an Energy Intensive Industry (EII) exemption for the FiT scheme. It would see EIIs avoid the indirect costs of the subsidy, funded instead by an increase in bills for non-exempt consumers. EIIs are already exempt from paying indirect costs for the Contracts for Difference and Renewables Obligation schemes. The FiT exemption will be introduced by 1 April 2019 or as soon as “practically possible”.

The FiTs closure consultation ends on 13 September, while the future for small-scale renewables consultation closes on 30 August.


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