DECC confirms 2016 changes to FITs

DECC confirms 2016 changes to FITs

DECC confirms FIT cuts

DECC has confirmed today that the new FiT rate will be 4.39p/kWh for Domestic installations up to 10kW.

The new rates are looking to be enforced by 8th February 2016. However, from the 15th January 2016 until 8th February 2016 there will be a 4 week pause on new FiT installations, so any installation made between those dates will not be eligible for previous rates and will instead get the newer, lower rates.

The full DECC review of the FITs scheme can be downloaded here.

My view

The generation tariff rate for most domestic installations registered prior to 15 January 2016 is 12.03p per kWh generated, with an additional 4.85p paid for export. As export is deemed at 50% for the majority of installations, the effective export rate is 2.43p; this means that the total paid per kWh is 14.46p per kWh under the current scheme.

Using the same calculation method, under the new scheme the combined generation and export payment comes to 6.82p per kWh, which is a not insubstantial 53% drop.

This is however far better than what was mooted in the initial consultation document. It is my belief that manufacturers and suppliers will make every effort to keep solar power attractive, and after a bit of a quiet spell the industry will pick up again.

The bottom line is though, if you get your installation fitted and commissioned on or before 14 January 2016 you’ll get more than double the return than if you wait until afterwards. At the time of writing RED Electrical still has capacity for installations within that timescale. Click here to get in touch.