FITs and GD

[Eco Deal]

Does anybody know where to find any docs that discuss the FITS and green deal

need to find the answers to the following

if a solar pv project is on a green deal plan can you claim FITS?

is 100% of the fuel bill saving taken in to account for the golden rule or only 50%?

i know people have heard rumors I am looking for documents for DECC etc.

 

[Gavin A]

1. yes - it's charged at commercial rates of interest so doesn't class as state aid funding, so is eligible for full FIT payments

you'll need to search for the rules on state aid funding rather than green deal specifically in the FIT guidance.

2 - !00% of the fuel bill saving, but I've no idea how this would be calculated. Possibly it could be based on 50% of generation, if so this'd be a serious fudge as it's unlikely to be true for most above about 2kWp.

 

[Eco Deal]

ok Gavin thanks for the help .

I know how golden rule is calculated . if 100% of the fuel bill is used then the green deal will be a key boost to the solar insdustry again .


if 50% is used the solar will NOT be saved by GD.

I have some very intresting results on the golden rule calcultions if

the FITS is claimed and 100% of the electric is used in GR cals .

butI need hard edvidence of that this will be the case.

 

[Gavin A]

what do you mean by 100% of electric though? It looks like you're using it differently to me - I was talking about 100% of the actual savings not 100% of the fuel bill. The best I think we could hope for is for this to be deemed at 50% of generation as standard, unless it was a particularly high electricity consuming house.

Surely it's up to the GD assessor to calculate this figure though and then be able to support the way they've calculated it if questioned on it / if sued at a later date because the figures were wrong. Or to put it another way, have they not brought the software out yet to calculate this for you?

#greendealshambles

 

[Eco Deal]

I was saying for example a 4kwp south produces 3400 kwh per year right.

so will the golden rule take into account the full 3400 kwh as a fuel bill saving or half ?

as 50% is assumed exported ...

Anyway I read a load of DECC docs and found the answer to some of the 10,000 gd questions I have ,

 

[Gavin A]

did you manage to find the answer to the questions on this thread?

 

[Eco Deal]

yes .

you use the savings from a occupancy assessment. which is "trimmed down" to air on the side of caution.

and it looks like the FITS can be cliamed see statement below i found

25.Green Deal finance, the FITs and RHI can work together as a package - We envisage organisations marketing energy efficiency, renewable heat and energy generation products together as packages of improvements. However, customers will not be able to use the expected future revenue from, for example, FITs payments to count as savings for the purposes of meeting the Golden Rule


now I will be registered on green deal orb in a week or two as a GDAS so if you guys need Green deal advice reports to get your customers green deal for solar or other measures come to me or join our network , gavin you aint to far from me so if you need a GDA then get us to do it for you . and no i wont try and quote on the solar jobs on the sly either we just want to do the EPC , GDAR and get you the funds from one of the three GDP's we working with. we may soon be a gdp at final stages now.

 

[TedM]

and it looks like the FITS can be cliamed see statement below i found

25.Green Deal finance, the FITs and RHI can work together as a package - We envisage organisations marketing energy efficiency, renewable heat and energy generation products together as packages of improvements. However, customers will not be able to use the expected future revenue from, for example, FITs payments to count as savings for the purposes of meeting the Golden Rule

I presume you mean FiTs cannot be claimed. I read that as meaning that only the energy saving element can be used - which isn't part of FiTs at all.

DECC source doc: http://www.decc.gov.uk/assets/decc/...rgy-efficiency-improvements-qualify-for-g.pdf

 

[Eco Deal]

no ted

Read it again

25.Green Deal finance, the FITs and RHI can work together as a package - We envisage organisations marketing energy efficiency, renewable heat and energy generation products together as packages of improvements. However, customers will not be able to use the expected future revenue from, for example, FITs payments to count as savings for the purposes of meeting the Golden Rule

so this says you can not use FITS for the golden rule calculation thats correct , but if you can get a system to fall into the golden rule using FUEL SAVINGS from the system ONLY then the client can have the system fitted with no up upfront cost at all !

then once the system is fitted the FITS can be claimed hence work together as a package.

All the DECC docs none of them mention NOT getting FITS plus you can use the RHI to make a green deal plan green deal able.

there is also a method where you can start your FIRST YEARS loan repayment lower then SAVING and then put it up 2% every year this way it helps to get more green deal measures under the GOLDEN RULE.

now if you guys need a GDAO call eco deal . we will be accredited Green deal adviser and on green deal orb soon.

 

[TedM]

I'm not disagreeing with any of that. Just that at £6k for a 4kW PV system there is no time soon (pending massive rises in electricity prices) that such a system could be 100% funded by a GD loan. It's clear that the actual FiTs payments cannot be taken into account for a GD loan.

Saving say 1000 kWh a year at 15p = £150 - I'm not sure how inflation affects the GD calcs but that seems that a £3k GD loan over 20 years would be the maximum allowable. The other £3k would have to be financed elsewhere. The figure for saving can obviously be 'massaged' but for the majority of owners it will be near enough to this.

I don't know if MCS or REAL have produced any guidance for installers on how this can or should be presented to customers, but I think you will have to be pretty careful about mis-selling the GD.

 

[Eco Deal]

Yes ted agreed . but some people are selling 4 kwp for less than 5k !!!!

so that a SAP 2009 cal

4 kwp south facing produces 3400 kwh PA

3400 x say 13p for fuel bill = £476 PA x by the current life time of the PV system (not the fit remember ) as per 25 years but lets say 20 to be on safe side

476 x 20 = 9520

so to meet the golden rule system cost , GDA cost and GDP fees must be less than 476 PA over 20 years

so 476 / 12 mths = £39.90 PA so the Green deal loan repayments have to be LESS than £39.90 in FIRST YEAR

so lets say we go for £35 PM so there fore £35 x 12 = £420 PA

ok now lets say a 4 kwp cost 6k so that would be £6000 / £420 PA = 14.28 years to pay it back.

PLEASE NOTE : I AM STILL LEARNING AND IF A 100% of the saving is used from solar pv then this calculation meets the golden rule .

of course intrest would be add etc ..

now ask yourself how easy would that be to sell ??? as the customer gets the system to pay for it self and then gets the FITS for 20 years and export !!!

NOW THATS A NO BRAINER.

I am not at the best at maths either.


NAPIT confirm i am the FIRST GDAO the have put in the system should be on green deal orb on FRIDAY ...

Like I said if you want to sell this to your customers then you will need a service of a good GDA .

I can help my old forum buds.

 

[Gavin A]

there are going to be very few situations where 100% of generation can be used within the house, at least without an Immersun and high levels of domestic hot water consumption, so that's a very niche market.

in your example you don't seem to have accounted for the 8%ish per year green deal interest rate, surely you have to account for this when working out your figures?

Have you not been supplied with or developed your own spreadsheets to calculated the GD costs including interest?

I'd be very interested if a convincing argument could be made that GD could be used to fully fund solar PV even if in very limited circumstances, but I don't see how your figures can really be right.

 

[Eco Deal]

Yes I have excel for this and Gavin I did state above that intrest would need to be added .

As long as the FIRST year payment is lower than the SAVING SEE BELOW

as long as my savings are higher than £42.00 PM then this meets golden rule spread over 20 years

PLEASE NOTE : I am giving examples to get the idea in your head you can adjust prices , payment terms and down payments to meet golden rule .

the goldne rule is to beat the mthly repayments and not to exceed the life time of the measure NOT the FINAL TOTAL COST IE £10,252.55

so its doable !

so the System cost , GDA fees cost £5510.00 so thats the amount to borrow over the lifetime of the system 20 years = payments of £42.72 PM

I do not know what the provider fees are or how they will make money yet or if they get the intrest but I will find out on monday as I am meeting two providers Monday.

[TABLE="width: 556"]
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[TD="class: xl72, width: 387, bgcolor: transparent"]Loan Payment Calculator Using PMT Function[/TD]
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[TR]
[TD="class: xl65, bgcolor: transparent"]Total cash back [/TD]
[TD="class: xl74, bgcolor: transparent, align: right"]£0.00[/TD]
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[TR]
[TD="class: xl73, bgcolor: transparent"]Amount To Borrow [/TD]
[TD="class: xl63, bgcolor: transparent, align: right"]£5,510.00[/TD]
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[TD="class: xl73, bgcolor: transparent"]Down Payment[/TD]
[TD="class: xl64, bgcolor: yellow"] [/TD]
[/TR]
[TR]
[TD="class: xl68, bgcolor: transparent"]Loan Amount[/TD]
[TD="class: xl71, bgcolor: #D8E4BC"]5,510.00[/TD]
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[TR]
[TD="class: xl68, bgcolor: transparent"]Payment Frequency[/TD]
[TD="class: xl71, bgcolor: #D8E4BC"]Monthly[/TD]
[/TR]
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[TD="class: xl68, bgcolor: transparent"]Term (Years)[/TD]
[TD="class: xl70, bgcolor: #D8E4BC"]20[/TD]
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[TD="class: xl68, bgcolor: transparent"]Annual Interest Rate %[/TD]
[TD="class: xl69, bgcolor: #D8E4BC"]7.00%[/TD]
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[TD="class: xl67, bgcolor: transparent"]Monthly Payment[/TD]
[TD="class: xl66, bgcolor: transparent"]42.72[/TD]
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[TR]
[TD="class: xl68, bgcolor: transparent"]Total Cost[/TD]
[TD="class: xl63, bgcolor: transparent, align: right"]£10,252.55
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[/TABLE]

 

[Gavin A]

ok, but almost nobody is going to save 42.72 a month from a 4kWp system.

The only situation I can possibly think of that might would be those on economy 7 with electric storage heatings, with high daytime electricity unit prices and high daytime consumption levels eg if they also worked at home, were retired, and probably had a swimming pool or other high electricity consuming devices in the house - maybe a farm with lots of freezers or similar.

Maybe if we pushed the costs down even further, and if electricity costs were to go up again. It's certainly an interesting one, and I can see that it's actually possibly just about within reach as being a viable option, but I'm not convinced it's quite there yet. The opportunities could be pretty big if we could make it work though, so I might do a bit more work on this when I get chance.

 

[infinity]

So how would it work if someone was able to contribute say £2000 to the cost of the system? Would this mean they could easily get the rest funded by GD?