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HCA funding and FiT (feed-in-tariff), revised tariffs from 1 April, massive cuts from 1 August

by Mel Starrs on March 21, 2011

in Accreditation, Funding & Targets, Feed In Tariff

Quite a week for PV (some of what follows also relates to other small scale renewables but PV is the main issue here).

An announcement was made by HCA last week regards double counting funding with regards to FiT (feed-in-tariff).

The gist is that FiT cannot be claimed by Partners on NAHP funded schemes for PV installations if the PV contributes to the required CSH 3* rating (i.e. if the PV was not there, points dropped under Ene1 Dwelling Emission Rate (i.e. the SAP) and Ene 7 Low and Zero Carbon Technologies would give a total score less than 57 points).

If the PV is over and above the 57 points required for CSH 3*, then FiT can be claimed.

The press release is below:

The Homes and Communities Agency has today issued a statement to its Investment Partners to explain how the Feed In Tariff relates to schemes that have received HCA funding.

The statement has been developed in conjunction with the Department for Communities and Local Government (DCLG) and the Department for Energy and Climate Change (DECC) to clarify issues about State Aid rules on ‘double public subsidy’ for Investment Partners.

Under the Feed In Tariff scheme, individuals, organisations and businesses in England, Wales and Scotland are able to claim back cash for electricity they produce from eligible renewable and low carbon sources. The scheme provides a fixed payment for the electricity generated and pays for any unused electricity exported to the grid as well as for electricity generated and used on site.

However, where an Investment Partner has been awarded funding through the National Affordable Housing Programme, or any other from of public subsidy, they will need to demonstrate that this funding has not been used to pay for installations for which Feed In Tariff is then sought.

Alison Mathias, strategy manager at the Homes and Communities Agency said: “We are writing to our Partners to help them understand the relationship between our funding and the Feed In Tariff so that it’s clear what can and can’t be claimed. Our enabling role includes helping to translate policy in to practical advice and we hope the statement we are sending to all of our Investment Partners today helps clarify State Aid rules on the Feed In Tariff.

“While one of our funding requirements is that Partners achieve Level 3 of the Code for Sustainable Homes on their schemes, this is very possible to achieve without the use of micro renewables. Therefore HCA requirements do not prevent Investment Partners from demonstrating that they have not used affordable housing grant to install microgeneration equipment while meeting our standards.

“We do emphasise though that grant recipients should ensure that they obtain independent legal advice where necessary.”

The Feed In Tariff scheme is administered by the Office of the Gas and Electricity Markets (Ofgem), whose responsibility it is to ensure suppliers comply with the requirements. Read the HCA statement for full details.

For HCA projects that have not received funding through the National Affordable Housing Programme but have received public investment in the form of land or other funding streams, partners will be advised on a case by case basis following consultation with legal experts to ensure clear understanding of the Feed In Tariff in these circumstances.

At much the same time, the new FiT rates were announced. The feed-in tariff is linked to the retail price index, so rates increase (or decrease) each year in line with inflation. The rates for the year commencing 1 April 2011 will be as follows:

Combined heat and power (CHP)

CHP with electrical capacity of 2kW or less: up 0.5p, to 10.5p per kWh (kilowatt hour).

Hydro

Less than 15kW: up by 1p, to 20.9p per kWh 16 -10kW: up by 0.9p, to 18.7p per kWh

Solar PV

Up to 4kW installed on new build: up by 1.7p, to 37.8p per kWh Up to 4kW retrofitted: up by 2p, to 43.3p per kWh 4 – 10kW: up by 1.7p, to 37.8p per kWh 11 – 100kW: up by 1.5p, to 32.9p per kWh

Wind

Up to 1.5kW: up by 1.7p, to 36.2p per kWh 1.6 – 15kW: up by 1.3p, to 28p per kWh >15 – 100kW: up by 1.2p, to 25.3p per kWh

Early adopters rate (payable to those who installed prior to 15 July 2009): 9.4p per kWh (up from 9p).

The export tariff will increase to 3.1p per kWh (from 3p currently).

But just as we all were breathing a sigh of relief, the long anticipated FiT review came out:

The new tariff rates, paid to producers of renewable electricity from solar panels, will be:

  • 19p/kWh for 50kW to 150kW
  • 15p/kWh for 150kW to 250kW
  • 8.5p/kWh for 250kW to 5MW and stand-alone installations

A 50kW array is around the size of two tennis courts.

These are to come into force 1 August 2011. At the minute it remains a consultation (fast track) and you have until Friday May 6 to comment.

So what will be the effect of this plus the RHI? More analysis to follow in due course…

 

  • Thegillespie8

    How would this be applied where no renewables are required to meet Code 3 and HCA funding has been recieved but there is a local planning requirement to provide 10% renewable heat source  and this has been met by installing PV panels. Is the occupier or “investment partner” able to claim FIT’s

  • Anonymous

    Individual cases should check with the appropriate bodies (i.e. don’t sue me
    for what I am about to say!), but my understanding is that if the 10% is
    above and beyond what is required by CSH3* – i.e. you would acheive CSH3* if
    the PV was not installed, then FiT can be claimed. Funding shouldn’t be
    double counted or awarded twice.