Tories promise early adopters of microgeneration better deal under feed-in-tariffs

Peta Hodge

19th February 2010

The Conservative Party has confirmed that, if elected, it will reverse the current Government’s decision to treat early adopters of on-site microgeneration schemes less favourably than those installing renewable energy technologies for the first time.

Under the detailed rules for feed-in-tariffs (FIT) – also known as the Clean Energy Cashback scheme – announced by the Department of Energy and Climate Change (DECC) at the beginning of this month, all solar PV, wind, hydroelectric and anaerobic digestion technologies with a capacity of less than 50 kilowatt (kW) will have to transfer from the Renewables Obligation (RO) support mechanism to the FIT scheme on April 1.

The issue is that businesses and households that installed their technology and applied for support through the RO prior to 15 July 2009, will transfer into the FIT scheme at a generation tariff of 9p/kWh – less than half the rate offered to those installing new technologies, which will generally receive 20-35p/kWh.

The decision not to offer early adopters the higher rate has been deplored by the wind industry and campaign groups, as well as the individuals who have installed small scale renewable energy technologies. A petition on the Number 10 website calling for "fair treatment" for existing microgenerators has so far attracted over 500 signatures.

The Government’s argument is that 9p/kWh is equivalent to what was on offer under the RO and to pay more would add cost to the scheme without delivering any more installations.

Early adopters of on-site renewables should be treated as "pioneers"

But this argument cuts no ice with Friends of the Earth's energy and climate campaigner Dave Timms who said: “DECC don’t get it. They seem to think that by saying people will be ‘no worse off’ than they were before does the job.

“I think we have a moral duty to people who have put often considerable sums of their own money, and taken on the work and the hassle of driving forward and demonstrating the viability of small-scale generation [...]

“They should be treated like pioneers and it should be recognised that they are likely to continue to be pioneers. They are some of the best advocates for local renewable energy.”

Although Alex Murley, head of small systems at the BWEA, said he understands that DECC’s intention is that FIT scheme should encourage new adopters of small scale renewables, he also thinks the Government has missed a trick.

“We’ve been involved in supporting policy development for some time and from the very beginning we suggested that the value of taking early adopters with you and allowing them to fully benefit from the scheme is much higher than the comparative cost incurred,” he said.

“We are very supportive of early adopters being grandfathered into the scheme at the standard high level.”

This is what the Conservative Party says it intends to do.

Conservatives position "warmly" welcomed by renewables industry and campaign groups

Shadow minister for Energy, Industry and Postal Affairs, Charles Hendry, confirmed today that he has written to an unnamed campaign group, promising that a future Conservative Government would ensure that microgeneration equipment installed prior to the FIT scheme will nevertheless be entitled to the same terms as new installations.

Friends of the Earth, the BWEA and the Renewable Energy Association (REA) all welcomed the development.

The REA’s head of external affairs, Leonie Greene, said her organisation would “warmly welcome” the change. “It’s crazy to alienate those who will be your most passionate advocates,” she said. “It turns them very little to turn them into advocates instead of bitter, disillusioned people.”