UK plans to cut renewable energy subsidies on solar and biomass plants

With the Feed-in Tariff, which supports smaller scale rooftop and solar farms, the proposal is to remove “pre-accreditation” – a lock-in to a fixed tariff level for six months, designed to give solar projects a window for financing and construction without the uncertainty of constantly reducing tariffs.

New projects that receive the subsidy may also see the level cut.

The move came after Amber Rudd, the energy secretary, announced plans to cut off subsidies for solar farms of up to 25 acres in size, vowing to end the “blank cheque” for green energy funded by families on their electricity bills.

The report said solar has to be “an inherent part” of the expansion strategies of local independent power producers’ (IPPs) as renewable energy obligations become more enforced and as the price of producing power from coal rises.

“We can’t have situation where industry has a blank cheque, and that cheque is paid for by people’s bills, ” Rudd said.

Measures to deal with a projected over-allocation of renewable energy subsidies have been announced today.

She added, “My priorities are clear”.

Referring to the huge 100GW by 2022 solar target the report said: “Technically this is achievable – if administrators are willing to put enough support behind it. Realistically, challenges of weak financials of distribution companies and grid constraints need to be addressed”.

Jonathan Selwyn, a board member of the Solar Trade Association, told BBC’s Today Programme that the solar industry only costs the government 6% of the total Renewable Obligations (RO).

Department of Energy and Climate Change minister Amber Rudd confirmed that many subsidy schemes will be axed from April 2016.

Solar arrays below 5MW (bigger solar farms had their support cut in April) will no longer receive renewable obligation certificates (ROCs) which force energy companies to buy from them at a set price.

The DECC said it will publish a final decision on its proposals after the start of September, once a consultation process will be completed.

Mr MacNeil said: “The measures raise more alarming questions for investors in low-carbon technologies who are already struggling to finance projects after a series of sudden policy changes”. She said the government might be sacrificing big climate change gains for budgetary savings that amount to “small change”.

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