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- Getting community energy involved in Local Enterprise Partnerships
- The energy system is in flux, let’s ready ourselves for a community takeover
- Celebrating a strong year for energised communities at CfR
- Community Energy at the forefront of disruptive change in the energy sector
- Meet your MP about community energy this Community Energy Fortnight
- We can do more to foster community energy in low-income communities.
- What next for community energy in a post-FIT world?
- A new generation of investors are using their money to drive change
- People, Power and Happiness
- A review of CEF17
- Community energy, a magic bullet for a multitude of charitable objectives
- Community Energy Fortnight Lobbying Pack 2017
- How smart technology is empowering rural energy projects
- Community energy is not just what we do, but how we do it - By Ed Mayo, Co-operatives UK
- “It's all still to play for" says Co-op Energy's Head of Renewables
- York Community Energy trip round the panels of Auld Reekie with Edinburgh Community Solar
- The Ramblers: Protecting the places we love to walk in a changing climate
- Why Community Energy Fortnight is so important - By Emma Bridge
- CEF17 is Powering Together!
- Community Energy Fortnight 2017 dates announced and news of a new collaboration
- The community energy revolution is evolving, and the future’s bright
- Investing in community energy schemes
- Energising faith communities: the Spirit project
- Community Energy - the way forward
- CEF16 dates announced
- The community energy revolution pushes on in face of storm clouds
- Blogs 2015
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What next for community energy in a post-FIT world?
Time is running out for the feed-in tariffs (FITs). This time next year, FITs will be history. Dan Curtis, Marketing & Energy Desk Coordinator at Brighton & Hove Energy Services Co-operative (BHESCo), explores what this means for community energy groups, and what the possibilities to finance new solar after April 2019 will be.
Feed-in Tariff (FIT)
The feed-in tariff was first introduced in April 2010 as a financial incentive to encourage property owners across the UK to install renewable energy technology on their homes and businesses.
Eligible systems receive a payment for the clean energy they generate that ‘feeds in’ to the National Grid, with prices guaranteed for 20 years from the date of the install.
As Leo Murray of 10:10 explains, “the Feed-In-Tariff has been the British government’s most popular and successful climate change policy ever, meeting its targets for deployment of solar PV and onshore wind five years early and allowing huge numbers of people to take a direct stake in the low carbon transition.”
The scheme has supported an increase in UK solar power from 22 megawatts (MW) in 2008 to 12,760MW in 2017, amounting to nearly 1 million installations. Last year, renewable energy such as wind, solar, biomass, and hydro accounted for nearly 30% of electricity generation, compared to nuclear power which stood at 21% (coal was just 7%).
Early adopters of the FIT scheme could expect to receive 46p for every unit of electricity they produced, making solar power projects a highly attractive long-term investment for homeowners, businesses and community energy groups.
However, this has since been reduced to just 4p per unit for new projects in 2018, and will end altogether from April 2019. In his last Autumn Statement, Chancellor Philip Hammond announced that once the feed-in tariff ends “there will be no new low carbon electricity levies until 2025”, leaving a big question mark over future government support for the renewables industry.
What this means is that any property owners or community groups who are considering solar panel projects now have less than 12 months to install their system and qualify for the Feed-In-Tariff. Those who are able to register a new installation before 31st March 2019 will still be eligible to receive 4p per kW generated for the next 20 years.
If that was not enough of an incentive, the cost of solar equipment has plummeted in recent years. Where a typical 4kW household system cost £15,000 in 2010, the equivalent today would be only £5,000.
In addition to cheaper solar power, other technologies such as heat pumps and battery storage have become much more affordable in recent years.
Once the Feed-In-Tariff ends, we expect batteries to play a crucial role in establishing the economic viability of new solar PV projects. With the absence of an incentive for exporting electricity to the grid, the emphasis moves towards consuming 100% of the energy generated onsite. Where this has previously been difficult, access to cheaper battery storage will now make this possible.
A shift in generation and consumption behaviour will also change the types of property that make ideal candidates for solar. Buildings that are in constant use such as hotels and care homes can make full use of the solar energy they generate, which will prove much cheaper than buying from the grid. In addition, moving to a solar power/ battery combination will help to defend properties from energy price rises we expect to see in the coming years. If new projects can combine generation with energy efficiency measures, which will further cut costs and deliver savings, the economic case for new community energy projects will prove as appealing as ever.
As has always been the case, innovation will be key to ensuring the success of community energy projects. Identifying the most viable properties and designing bespoke systems must be the focus if the sector is to thrive and survive.
Carbon Brief (2018) "Low-carbon sources generated more UK electricity than fossil fuels in 2017". Available here.