FiT changes will 'kill' renewables
REA said removal of pre accreditation will 'severely hit' industry
Industry leaders have said DECC plans to remove pre-accreditation for the Feed in Tariff will "kill off" popular renewable sectors, bringing with it worse value for money.
The government department, led by Secretary of State Amber Rudd (pictured), has been holding a consultation into the future of the FiT in a bid to "limit the risk to billpayers of a deployment surge under the FiT through the removal of pre-accreditation".
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DECC has said this is just the start of a review into the entire FiT scheme - due to be held later in 2015 - where they will consult on a "package of further cost control measures" which will include looking into the appropriateness of current tariff levels.
But now industry has hit out at the plans which they have labelled as yet another blow to an already wounded industry.
REA head of policy and external affairs James Court said: “Many communities, local authorities and schools are wanting to do the right thing in installing renewable projects and the government have previously seen this as an area they want to support. Yet this change will severely hit any such organisation, who by their nature have longer processes. For many, this will now be a non-starter, they couldn’t take the risk.
"This is on the back of an inadequate consultation process with a lack of impact assessment the obvious criticism. The REA questions how a consultation with the intention of saving money be useful - without knowing how much will be saved and how. The industry has come out in force to explain that the proposals will not just slow the deployment of renewables but will in some cases, kill off sectors entirely."
Endurance Wind Power Vice president Brett Pingree added that banks will not approve loans under the proposed changes.
“Pre-accreditation is a leading indicator for FIT spending, providing an estimate of energy production and FIT payments up to one year before projects are even commissioned. In this way, the pre-accreditation system gives Ofgem and DECC a one year forecast of FIT spend. To remove pre-accreditation would seemingly undermine their ability to manage budgets for the deployment of small-scale renewables," he said.
DECC has blamed a "higher than expected" renewable deployment with latest projections of spend under the Levy Control Framework forecasted to hit £9.1bn in 2020/21.
DECC said: "We propose to remove pre-accreditation and pre-registration from the scheme. This will have the effect of removing the link to the tariff guarantee for installations currently able to pre-accredit , such that installations will only receive the tariff rate as at the date they apply for full accreditation.
"This will mean a developer will not be certain of the level of support they will receive until the point at which their application for accreditation is received by Ofgem. This corresponds to the existing situation for most sub-50kW solar and wind projects as well as installations under the Renewables Obligation."
The government added that because the changes would impact in particular on community projects, as part of the later FiT review later this year they may consider whether there is a case for reintroducing pre accreditation for communities or other groups on a case-by-case basis as they see "appropriate".
Any changes will implemented through secondary legislation via changes to the Feed in tariffs Order 2012.
Companies were issued with the consultation documents on July 22 and were given until yesterday to respond (19 August).
DECC is expected to announce its findings from the consultation within the next week.