Tuesday, October 26, 2010

UK government decides against solar feed-in tariff cuts

The UK's Chancellor of the Exchequer, George Osborne, announced the coalition government's Comprehensive Spending review, revealing that there will be no immediate cuts to the country's solar feed-in tariff.

After much speculation that the coalition government would slash the feed-in tariff set by the country's Department of Energy and Climate Change, it was finally announced by the Chancellor that:

"The efficiency of feed-in tariffs will be improved at the next formal review, rebalancing them in favour of more cost-effective carbon abatement technologies. This will save £40 million in 2014-15. Support for lower value innovation and technology projects will also be reduced, saving £70 million a year on average over the Spending Review period."

Therefore feed-in tariffs will be refocused on the most cost-effective technologies in 2014-15. The changes will be implemented at the first scheduled review of tariffs unless higher-than-expected deployment requires an early review.

The Renewable Energy Association's (REA) PV specialist consultant, Ray Noble, said of the review, "This is excellent news for the UK solar industry. It's exactly what the market needs in order to fulfill its fantastic potential. The outcome of today's review could not have been better."

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