Government 'strangling' homeowners' efforts to go solar

UK: The Government has been accused of “strangling” homeowners’ attempts to harness renewable energy after it emerged they will have to shell out thousands of pounds in order to qualify for solar panel subsidies.

With the industry still reeling from the decision to cut the Feed-in-Tariffs for domestic Solar PV schemes by more than half, it has also emerged that the majority of homeowners will be forced to spend more than £5,000 making their homes more energy efficient.

Homeowners will be forced to undertake an Energy Performance Certificate (EPC) and should their property fail to achieve a ‘C’ energy rating – currently almost 9 in 10 homes are not - they will not receive the Government’s higher rate of Feed-in-Tariff subsidies.

Bringing those homes up to the standard required through insulation and heating improvements would cost up to £5,600 according to the Department of Energy and Climate Change, although the Renewable Energy Association says the true cost could be nearer £7,000.

David Hunt, a director with leading renewable energy company Eco Environments, said: “A lot of attention has been focussed on the savage slashing of the Feed-in-Tariffs (As of December 12, the tariff for Solar PV schemes up to 4kW was cut from 43.3/kWh to 21p/kWh). However, just as the solar industry is trying to come to terms with the drastic and sudden reduction in FITs, it now faces a second devastating blow.

“The Government may claim that homeowners making the necessary improvements to their homes will ultimately be able to recoup their outlay through the available subsidies, but in the short-term it will seriously affect their return on investment. And only homes meeting the ‘C’ rating will qualify for the 21p rate; those that do not will have to make do with just 9p.

“We believe that rather than forcing homes to come up to the ‘C’ energy rating, it would make far more sense to simply urge homeowners to take all practical measures to make their homes more energy efficient. These are the two options on the table as part of the Government’s consultation period.

“There is a week left in the consultation and a week in which Ministers can pull back from the double whammy they are imposing not only on the solar industry, but also on homeowners in the UK.

“While we recognise that a cut in the FIT subsidies was inevitable, we, like many others, were disturbed by the speed of the implementation and the sham consultation period. The railroading through of the stringent EPC requirement is a further blow to one of the UK’s most exciting and growing sectors.”

The Government’s consultation period ends on December 23rd and from March 31st 2012 homes must reach an EPC ‘C’ energy rating or above in order to qualify for the highest level of FIT.

David Hunt said the double whammy could even be considered a “triple whammy” if you include the decision not to include Solar PV and other forms of microgeneration in the Government’s Green Deal when it comes into effect next year.

While renewable energy technologies including solar panels could be supported through the Green Deal – which will cover the upfront cost of energy saving measures that will then be paid for through a surcharge on energy bills – any scheme would have to meet the so called “golden rule”. The rule states that resulting energy savings must exceed the repayments made on the initial financing package, something which would be virtually impossible given the cost of renewable energy technologies.

Hunt said: “The failure to make microgeneration schemes part of the Green Deal is another missed opportunity by this Government. With each ill-thought out and at times reckless decision, Ministers make a mockery of any claim they might have to green credentials.”