The Department for Energy and Climate Change (DECC) has today issued a response to the Consultation on change to financial support for Solar PV under the Renewables Obligation (RO) and Feed-in Tariff (FIT) schemes. We have highlighted below the key proposals that have now been confirmed by DECC and the new proposal which are being consulted on. 

Renewables Obligation

CONFIRMED: The closure of RO to new solar PV projects above 5MW in Great Britain from 1 April 2015. This deadline applies to both new generating stations and existing accredited stations seeking additional capacity, where the station is, or would become, above 5MW.

CONFIRMED: A 12 month grace period will be available to solar PV projects, which will extend the deadline for RO accreditation for eligible applicants to 31 March 2016. In order for a project to be eligible for the grace period, the developer must demonstrate that it has achieved certain requirements/milestones as at 13 May 2014. The Government has however made several adjustments to the evidence required for the grace period proposed in the consultation, including:

  • removing the requirement for the developer to have secured a planning permission by 13 May 2014. This is replaced by the requirement to have submitted a planning application by 13 May 2014;
  • removing the requirement on the developer to obtain a letter from the network operator estimating a grid connection date on or before 31 March 2016;
  • removing the requirement on the developer to have spent £100,000 per MW of installed capacity or to demonstrate all material equipment contracts have been entered into by 13 May 2014; and
  • expanding the ways that developers can provide evidence of an interest in land (this now includes options to lease).

NEW PROPOSAL: Under a new consultation, DECC is proposing to introduce a three-month grid delay grace period for solar PV projects (both new generating stations and existing accredited stations seeking additional capacity) over 5MW. Under the new proposal, developers will be able to apply for RO accreditation before 30 June 2015, if they provide the following:

  • a grid connection agreement (consisting of grid connection offer and acceptance and a letter from network operator evidencing that the estimated grid connection date is no later than 31 March 2015);
  • a declaration by the generator that the station would have been commissioned on or before 31 March 2015, if the connection had been made on or before the estimated grid connection date; and
  • a letter from network operator confirming that the delay was not due to any breach of the developer.

The consultation closes on 24 October 2014 and responses can be submitted to SolarPV.Consultation@decc.gsi.gov.uk

Feed-in Tariffs

CONFIRMED: The current degression band for installations greater than 50kW and all “stand-alone” installations  is to be split into two new degression bands.

NEW PROPOSAL: DECC has decided that the split for the degression triggers of the above two bands will be 65% other-than-stand-alone, 35% stand-alone (as opposed to the 75:25 split previously proposed). Despite the fact that the ratios have been adjusted, this still means that the generation tariff will decrease more quickly for ground based solar PV than it will for roof based solar PV (assuming equivalent level of deployment). This echoes the Government policy intent to encourage roof top solar PV installations instead of ground-based solar installation.

The degression band split is intended to take effect before January 2015, subject to approval from Parliament.

NEW PROPOSAL: DECC is consulting on amending the definition for other-than-stand-alone installations, which will mean that for an installation <250kw to be considered stand alone, it must demonstrate a minimum of 10% on-site usage.

The consultation closes on 24 October 2014 and responses can be submitted to SolarPV.Consultation@decc.gsi.gov.uk