Government Solar Power Subsidies to be Axed

Solar power is a clean renewable energy source with the potential to replace conventional fossil fuels such as gas and coal. This has a positive impact on the environment as it reduces the effects of land, air and water pollution caused by fossil fuels and reduces the carbon footprint of energy generation. There are a number of additional benefits of using solar power, for instance the industry creates thousands of job opportunities across the UK. EPC London would be able to tell you just how effectively solar panels would increase your energy efficiency at home.

The benefits of solar power are now widely recognised and electricity generation from solar panels has increased rapidly in the UK over the last 10 years. A decade ago it provided virtually nothing; but renewable energy now makes up nearly a third of all electricity generated in the UK.

Feed-in Tariff

This boom was largely driven by a support scheme, known as Feed-in Tariff, that was introduced by the government in April 2010 to encourage the uptake of renewable energy sources. Under this scheme, homeowners who decided to invest in solar panels received payments from energy companies for generating their own electricity. Homeowners could use the electricity they generated for free, and would also get paid for every unit that they didn’t use but exported back into the grid. Feed-in Tariff payments were guaranteed for 20 years and were tax free. It guaranteed long-term premium payments for renewable energy and meant that people could pay back the costs of their installations within 10 years and then go on to make a profit. This incentive resulted in thousands of domestic installations along with numerous industrial, commercial and community projects.

Government Subsidy Cuts

These incentives were slashed dramatically at the start of 2016. Householders received a 65% reduction in payments and installations plummeted as a result. Solar power installations fell by a massive 74%, compared with the same period the previous year. The scheme was far more popular than the government anticipated and ministers stated that these cuts were because the budget allocated to the scheme had nearly run out.

Next April the scheme will close entirely and ministers are yet to signal that it will be replaced. Under the government’s new proposals, homeowners will not be paid for supplying the grid with their generated solar energy. It is expected that installations will continue to plummet and some argue that the UK solar industry will be damaged further, if not destroyed completely.

Many people are asking why the government are making these cuts following the scheme’s success in encouraging and supporting renewable energy. The government states that this is part of it’s plan to limit green energy taxes and lower costs. UK Energy Secretary Amber Rudd said: “We have to get the balance right and I am clear that subsidies should be temporary, not

part of a permanent business model. When the cost of technologies come down, so should the consumer-funder support.”

Energy for Londoners Scheme

London Mayor Sadiq Khan has expressed his concerns that government proposals to end the Feed-in Tariff scheme will hinder efforts to boost installation of solar technology in the capital, and has urged ministers to rethink their decision. The Mayor has set the ambition for London to be a zero carbon city by 2050. To achieve this, London’s homes and businesses with need to be provided with clean, renewable energy.

The Solar Action Plan, the first of its kind for London, details how the Mayor will take advantage of solar energy and increase installations over the coming years through his Energy for Londoners programme. This programme will address fuel poverty, offering households up to £4,000 in grants to fund improvements such as insulation and new boilers. This plan also aims to make London’s homes and businesses more energy efficient, and to improve access to clean, local power across the capital.

Final Thought

The Feed-in Tariff, along with other schemes designed to encourage renewable energy, have played an important role in creating a growing and thriving solar power industry in the UK. Cuts to these schemes have damaged a lot of that industry. Solar is a clean, safe power source with the potential to replace current fossil fuels and reduce the land, air and water pollution associated with these conventional fossil fuels. It’s important that the government continues to support and take advantage of the huge potential of using solar power as a clean, green source of energy that can contribute to a sustainable future.