Possible 6 Month delay to FIT Cuts

[Somecamel]

Ok, So I've had a contact email me last night with a suggestion being made by one of the 'Larger' field mount companies that the Feed in Tariff cuts are going to be delayed for 6 months and they are now positioning themselves to get back on with some of the Solar Farms they had put off after the initial announcement.

Now this is purely on the rumour mill at the moment but I was wondering if anyone else had heard anything else about this.

 

[Gavin A]

as far as I can work out the statutory instrument would have needed to be laid before parliament last Friday for it to have taken effect on 1st Jan as it needs to be laid before parliament for 40 working parliamentary days in advance of anything taking effect and parliament breaks up on 17th Dec.

So once again it appears that DECC have completely cocked up the government's own procedures as if they'd laid the document before parliament on the same day the consultation ended then that would always have been subject to successful legal challenge as there's no way they could possibly argue that they'd taken proper consideration of the points raised in the consultation period prior to submitting the SI.

If they submitted it today then they couldn't implement anything until the 8th January.

 

[Somecamel]

That's interesting Gavin, for some reason I had the 22nd November in my head for the last day they had for the new rates to come into effect from the 1st January so must have read it somewhere.

I've just had a chat with Segen to see if they had heard anything and they expecting the rates to change from the end of January not the 1st as expected.

As usual the confidence is diminishing fast and you have to wonder how on earth we're meant to run a business with this much uncertainty.

 

[Gavin A]

I can't remember now, and can't seem to find out, if weekends count within the 40 days or not. If they do then they've got another week or 2.

 

[TedM]

ISTR looking in to this a few years ago and I think week-end days do count in the 40. It is only days that Parliament is specifically closed that do not count:

Instruments and draft Instruments laid before the House under the Statutory Instruments Act 1946 (sections 5 and 6) are subject to negative resolution for a period of forty days, beginning with the day on which copies of them are laid. In reckoning this period, no account is taken of any time during which Parliament is dissolved or prorogued, or during which both Houses are adjourned for more than four days.

http://www.publications.parliament.uk/pa/cm/cmsilist/cmsilist.pdf

 

[TedM]

I calculate the 40 day period until the 17th December to start on the 3rd of November - 1 week from today - as there is a 5 day closure from 11th to 15th November. Otherwise it would be 8th November.

 

[Gavin A]

I was starting to come to conclusion that that was the case.

So 3rd Nov we get to find out how bad the pain is going to be?

I can't really see that 7 working days is going to be enough time for them to have sufficiently considered all the consultation responses to not lose a legal challenge, so we're going to be back into that situation of a cut done wrong that ends up being thrown out in court..... chaos again.

 

[Somecamel]

Looking like we're going to have another month before the 'big' cuts are pushed through...

Ofgem publishes prospective FiT rates for 1 January | Solar Power Portal

 

[TedM]

OFGEM are obliged to issue these new tariffs as they are on a separate timeline from the consultation.

The tariff doc comes with the proviso "THESE TARIFFS ARE PUBLISHED BASED ON LEGISLATION IN FORCE AS OF THE DATE OF PUBLICATION" which is not usually there.

 

[The Solar King]

there are 30-35000 plus responses to the consultation. Part of this is down to Greenpeace who have got everyone and their dog to respond.

I had heard it was likely to be end of January to mid February before any changes could be enacted. The irony is the volumes currently going through are likely to trigger a super degression at the start of quarter two which would put the 0-4kw band between 8p and 9p. This is heading toward the maximum the industry has been asking for.

 

[Gavin A]

wow, that's a huge number of responses. Good going by Greenpeace and FOE, and STA.

 

[whinmoor]

I got this response today to my lengthy monologue - looks like they had a deluge in the final week:

************************

Thank you for responding to the FIT Review consultation. Due to the high volume of responses near the close of the consultation we were not able to confirm receipt of individual responses at the time. This e-mail acknowledges that we have received your response.

We are currently analysing feedback submitted during the consultation. We expect to publish a Government Response later in the year which will detail any changes we intend to make to the scheme.

Regards,

FIT Review Team

 

[whinmoor]

Interesting to read the review by Cambridge Econometrics which pulls apart the Parsons Brinkerhoff study:

"The implications for the Feed-in-Tariff of the assumptions selected was
significant:

The result of the DECC impact assessment was for a Feed-in Tariff rate of
1.64p/kWh for small scale solar PV. Our calculations, which are based on
the alternative assumptions suggested in this report, show that this would
provide an annual real rate of return of just 1.5% for the best sited locations
in the country, and a negligible 0.4% for the average household.

In order to provide potential investors with a rate of return in line with the
previous literature, the FIT rates would need to be increased above those
proposed in the impact assessment. A FIT rate of 7.92p/kWh would provide
a 4.8% return to the average investor, and a 6.2% return to the best sites,
whereas a FIT rate of 9.11p/kWh would provide a 6.2% return to the
average investor, and a 7.1% return to the best sites under our revised
assumptions."

http://www.bpva.org.uk/media/174382/review-of-decc-ia-v20.pdf

 

[The Solar King]

The chief economist at DECC has had to acknowledge that the data used is somewhat inaccurate.

when presented the Good energy report showing the Merit Order Effect and why solar cost only half that assumed to the LCF tried to make out it must all be more complicated than that and there must be other factors.

Interestingly I am told that all the clever analysts and economists at DECC leave after five years for jobs in the City that pay twice as much......

 

[Gavin A]

I find it hard to believe there are any clever analysts or economists at DECC.