Content:

FITS Review
Fast Track Review
Modification to Extension of Plants

Based on extracts from DECC website:

FITs Review

On 7 February 2011, the Government announced the start of the first comprehensive review of the Feed-in tariffs (FITs) scheme for small-scale low-carbon electricity generation.

A principal objective of the review is determining how the efficiency of FITs will be improved to deliver  £40million of savings, around 10%, in 2014/15 as committed to in the 2010 Spending Review [External link]. This commitment reflects the need for a responsible approach to public subsidies like FITs, to ensure value for money for consumers. 

HM Treasury recently published a control framework for DECC levy-funded spending [External link] which includes the FITs Scheme. 

….

Comprehensive review

The comprehensive review is considering all aspects of the scheme including:

  • Tariff levels 
  • Degression rates and methods 
  • Eligible technologies 
  • Arrangements for exports 
  • Administrative and regulatory arrangements 
  • Interaction with other policies 
  • Accreditation and certification issues

We will consult on the comprehensive review later this year. The review will be completed by around the end of 2011, with tariffs remaining unchanged until April 2012 (unless the review indicates the need for greater urgency). 

Since then there has been very little from DECC or the ministers involved at all, apart from of course the fast track review that they conducted in March – June which effectively killed off all solar projects > 50kWp.

The only other information available officially from deck is the announcement of the above review, and the accompanying written statement, I’ve reproduced them in full below, you can see the originals here:

Huhne takes action on Solar farm threat (Press Release)

Feed-in Tariffs: Written Ministerial Statement by Chris Huhne

Huhne takes action on Solar farm threat

Press release: 11/010
7 February 2011

  • Comprehensive review of Feed-in Tariffs starts now to provide investment certainty.
  • Fast-track consideration to be launched into large-scale solar installations and farm-scale anaerobic digestion plants.

Energy Secretary Chris Huhne has today launched a comprehensive review of the Feed-in Tariffs (FITs) scheme following growing evidence that large scale solar farms could soak up money intended to help homes, communities and small businesses generate their own electricity.

Since FITs began last year it has been a huge success at stimulating green growth, driving innovation, creating jobs and cutting carbon.

More than 21,000 installations have been registered to date. The vast majority of these are domestic installations, including solar panels, wind turbines and microhydro plants.

Last year’s Spending Review committed government to save 10% of the costs of FITs in 2014-15 through a review due to start in 2012 or earlier if uptake exceeded Government expectations. Because of the risk of an increasing number of large scale solar farms which could push FITs costs off track, and the need to give industry added certainty to invest, the coalition is today announcing a comprehensive review into the scheme. We also hope to publish next month measures to support renewable heat within the budget agreed at Spending Review.

Chris Huhne said:

“The renewables industry is a vital piece in the green growth jigsaw and this review will provide long term certainty while making sure homes, communities and small firms are encouraged to produce their own green electricity.

“Large scale solar installations weren’t anticipated under the FITs scheme we inherited and I’m concerned this could mean that money meant for people who want to produce their own green electricity has the potential to be directed towards large scale commercial solar projects.”

The comprehensive FITs review will:

  • assess all aspects of the scheme including tariff levels, administration and eligibility of technologies
  • be completed by the end of the year, with tariffs remaining unchanged until April 2012 (unless the review reveals a need for greater urgency)
  • fast track consideration of large scale solar projects (over 50kW) with a view to making any resulting changes to tariffs as soon as practical, subject to consultation and Parliamentary scrutiny as required by the Energy Act 2008.

Alongside the fast track review of large scale solar PV, a short study in to the uptake of FITs for farm based Anaerobic Digestion (AD) plants will also take place. Only two such projects have been accredited so far and by this point at least six were expected. The tariff rates will be examined to see if they are enough to make farm based AD worthwhile.

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 at the time will not be affected.

Notes for editors
  1. Broad terms of reference for the review are available from the First review of Feed-in Tariffs (FiTs) web page.
  2. According to Ofgem, the total installations to date (to 26 January 2011) under the FITs scheme are as follows:
  • Anaerobic digestion – 2
  • Hydro – 178
  • Micro CHP – 36
  • PV – 19854
  • Wind – 1132

The total installations have a combined capacity of 76.66MW.

Feed-in Tariffs: Written Ministerial Statement by Chris Huhne

7 February 2011

I am today announcing the start of the first review of the Feed in Tariffs (FITs) scheme for small scale low carbon electricity generation.

Decentralised renewables are vital to green growth and the FITs scheme has proved highly successful at stimulating growth, driving innovation, creating jobs and cutting carbon.

Since the scheme began last year more than 21,000 installations have registered to date. The vast majority of these are domestic installations, including solar panels, wind turbines and micro hydro installations. The scheme is working well. The take-up of solar photovoltaic (PV) panels under FITs has been a success with 20,000 installations now registered. However, there is room for improvement. I am concerned about the impact of super-size solar installations. I am also disappointed at the lack of farm based Anaerobic Digestion plants currently accessing FITs.

In light of the economic and fiscal situation, inherited by the Coalition, it is imperative that we take a more responsible and efficient approach to public subsidy, including where this subsidy is funded through energy bills. Specifically the Spending Review committed to improving the efficiency of FITs and finding £40million of savings, around 10%, in 2014/15.

Since the Spending Review, I have become increasingly concerned about the prospect of large scale solar PV projects under FITs, which was not fully anticipated in the original scheme and could, if left unchecked, take a disproportionate amount of available funding or even break the cap on total funding. Several large solar installations have already received planning permission. Industry projections indicate there could be many more in the planning system. In light of this uncertainty and the risk that such schemes could push FITs uptake off trajectory and may make the Spending Review savings difficult, I have decided to end the potential for damaging speculation and bring forward the review of the Scheme to look at ways of correcting these early teething problems.

I recognise that industry needs a long term plan for investment in which it can have full confidence. Today I am announcing a comprehensive evidence based review in to the FITs scheme and, to provide further certainty to the renewables industry, I can confirm that we also hope to publish next month measures to support renewable heat within the envelope agreed at Spending Review.

The FITs review will:

  • Assess all aspects of the scheme including tariff levels, administration and eligibility of technologies
  • Be completed by the end of the year, with tariffs remaining unchanged until April 2012 (unless the review reveals a need for greater urgency)
  • Fast-track consideration of large scale solar projects (over 50kW) with a view to making any resulting changes to tariffs as soon as practical, subject to consultation and Parliamentary scrutiny as required by the Energy Act 2008.

Alongside the fast track review of large scale solar PV, we will also undertake a short study into the take-up of FITs for farm based Anaerobic Digestion plants. Only two such projects have been accredited so far and by this point at least six were expected. We are looking again at the tariff rates inherited from the previous administration to see if they are enough to make farm based Anaerobic Digestion worthwhile.

Broad terms of reference for the review are available from the First review of Feed-in Tariffs web page and we are seeking views on specific issues to be considered. 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 at the time will not be affected.

 

Here’s what they did before:

Fast track review 

As part of the comprehensive review, we have given fast-track consideration to the tariffs for large-scale (over 50 kilowatts) and stand alone solar photovoltaic (PV) projects and farm-scale anaerobic digestion (AD) projects (up to and including 500 kilowatts). A consultation on the fast-track review was held over the period 18 March to 6 May 2011.

The outcome of this consultation was announced on 9 June 2011. This confirmed that, having carefully considered the responses received, the Coalition Government has decided to proceed with the proposed tariff reductions for large scale solar PV (over 50 kilowatts) and all stand-alone PV projects, and increases for farm-scale AD projects (up to and including 500 kilowatts). The detail of this decision and the analysis underpinning it are set out in Feed-in tariffs scheme: Summary of responses to the Fast Track Consultation and Government Response.

The new tariffs for large scale (over 50 kilowatts) and stand alone solar PV came into force on 1 August 2011. These new tariffs were introduced through:

Modifications to the Standard Conditions of Electricity Supply Licences

Timeline:

Announce – Publication = 39 days
Consult = 49 days
Prepare = 34 days
Before Parliament = 53 days

TOTAL: 175 days

Treatment of Extensions Change to Fits

Since announcing the outcome of the fast-track review, we became increasingly aware of evidence that some large-scale solar PV developers were intending to use provisions in the FITs legislation on the accreditation of extensions to installations, to take advantage of the current tariffs beyond 1 August 2011. This was not the intended effect of the extension rules and was clearly inconsistent with the objective of the fast-track review.

Therefore, a consultation on the treatment of extensions was held over the period 27 July to 31 August 2011. The outcome of this consultation was announced on 27 September 2011 and confirmed the decision to amend the rules on extensions. These amendments are being made through the Feed-in Tariffs (Specified Maximum Capacity and Functions) (Amendment No.3) Order 2011. This was laid in Parliament on 27 September 2011 and will come into force on 18 October 2011.

Timeline:

Consult = 35 days
Prepare = 27 days
Before Parliament = 21 days

TOTAL:  83 days

 

POSSIBLE TIMELINE:

Based on their previous track record, they will have already decided what they are doing and the ‘consultation exercise’ will be purely to go through the motions.

Consultation period: 40 days

At the end of that period it will be laid straight into parliament.

Before Parliament: 40 days

So if the Strategic review is published on the 19th October and they allow 40 days for consultation and 40 days before parliament that gives until the 7th January.