Feed-In Tariffs - Making sunlight a cash crop - Philip Wolfe (Ownenergy)
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Feed-In Tariffs - Making sunlight a cash crop - Philip Wolfe (Ownenergy)

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presentation on the feed-in tariff, solar pv and suitability for farm buidlings

presentation on the feed-in tariff, solar pv and suitability for farm buidlings

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    Feed-In Tariffs - Making sunlight a cash crop - Philip Wolfe (Ownenergy) Feed-In Tariffs - Making sunlight a cash crop - Philip Wolfe (Ownenergy) Presentation Transcript

    • Feed-In Tariffs
      Making sunlight a cash crop
      Philip Wolfe
    • Feed-In Tariffs - how to benefit
      Feed-In Tariffs (FITs) - the fundamentals
      Tariff levels for PV
      Who gets the cash & where it comes from
      How to ensure FITs work for your farm
      13th October 2010
      Sunlight cash crop through Feed-In Tariffs - Philip Wolfe
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    • The UK’s Feed-In Tariffs
      The three main value streams
      Generation tariff
      Savings on imported energy
      Export bonus
      Eligible technologies and tariffs
      Administration
      Renewable Heat
      13th October 2010
      Sunlight cash crop through Feed-In Tariffs - Philip Wolfe
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    • The 3 main value streams
      13th October 2010
      Sunlight cash crop through Feed-In Tariffs - Philip Wolfe
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      3
      2
      1
      Total benefit to owner =
      Generation tariff +
      Saving on reduced imports +
      Export bonus
      1
      2
      3
    • The Generation Tariff
      Paid for every kWh generated;
      whether used by the system owner
      or exported back to the grid
      Level depends on:
      The renewable energy technology
      The capacity of the system
      The date of installation
      13th October 2010
      Sunlight cash crop through Feed-In Tariffs - Philip Wolfe
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    • FIT Eligible technologies
      Biogas from anaerobic digestion
      Hydro-power
      Solar photovoltaics
      Retrofit in existing property
      New-build (properties not yet occupied)
      Stand-alone (systems for pure grid-feed)
      Wind power
      Micro-CHP (non renewable)
      13th October 2010
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    • Eligible capacities
      The FITs cover installations up to 5MW
      Except Micro-CHP only up to 2kW
      The tariff level depends on:
      So-called ‘Total Installed Capacity’
      The capacity is per ‘site’
      Additions based on cumulative capacity
      Installations must be accredited
      Systems under 50kW – MCS
      Systems over 50kW – ‘ROO-FIT’
      13th October 2010
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    • Ineligible installations
      Other RES-E technologies:
      Biomass, geothermal, tidal, wave, biofuel
      Hopefully to be reconsidered on review
      Systems over 5MW
      Second-hand and refurbished systems
      Pre 15th July ‘09 installations
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    • FIT tariff levels
      13th October 2010
      Sunlight cash crop through Feed-In Tariffs - Philip Wolfe
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      PV
    • The Export Tariff
      For every kWh exported to the grid
      The beneficiary gets the generation tariff
      Plus a premium for export, as follows
      A fixed rate of 3p/kWh has been set
      But you can opt out and negotiate
      a better price from an electricity supplier
      Opt-out decisions can be made each year
      13th October 2010
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    • Duration of tariffs
      Tariffs are fixed for 20-25 years
      Except micro-CHP for 10 years
      PV is 25 years all others are 20
      Tariffs are index-linked to the RPI
      Both generation and fixed export tariffs
      New rates will be announced annually
      For new installations tariffs change:
      Subject to degression
      Maybe at reviews (5-yearly from 2013)
      13th October 2010
      Sunlight cash crop through Feed-In Tariffs - Philip Wolfe
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    • Tax treatment
      Householders don’t pay Income Tax on
      The generation nor the export tariffs
      ... provided that it is for
      “households who use renewable technology to generate electricity mainly for their own use”
      Business has no special tax exemption
      but can offset costs against profit as usual
      No Enhanced Capital Allowances for PV (yet)
      13th October 2010
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    • How the tariffs were set
      To achieve an “average 5-8%” return
      Would equate to roughly 12-year ‘payback’
      We find that typical systems:
      Recover their costs ~ twice over the period
      That is equivalent to a 12-year payback
      We find that the best systems:
      Recover their costs 2½ to 3 times
      Equivalent to less than 10-year payback
      Index-link & tax break improves all this
      13th October 2010
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    • Where the money comes from
      The scheme is set in law, but
      The government doesn’t pay for it
      It comes from a levy on electricity bills
      It’s collected and paid out by suppliers
      Who have a ‘levelisation’ system to share the costs fairly between them
      It is now part of their licence conditions
      Only small suppliers can opt out
      Others are called ‘FITs licensees’
      13th October 2010
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    • Who the money goes to
      The beneficiary is the system owner
      He can specify a ‘nominated recipient’
      to whom is tariff payments can be made
      He nominates (and can change)
      which FITS licensee will pay over the tariff
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    • Scheme administration
      Scheme is administered by Ofgem, who
      Maintain the register of FITs installations
      Oversee the levelisation process
      Accredit systems over 50kW
      Have issued guidelines on how it works
      For more details:
      www.FITariffs.co.uk
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    • Issues with the FITs
      Public awareness
      Little government promotion
      Consenting
      Small systems ‘permitted development’
      Larger developments less certain
      Tariff levels
      Financing
      No official finance available
      Finance providers’ knowledge; conditions
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    • Project-specific issues
      Maximum capacity 5MW
      Accreditation required
      Pre-accreditation under ROO-FIT?
      Must use conforming meter
      Selection of ‘FITs Licensee’
      Use of nominated recipient
      Timing: Degression; seasonality
      13th October 2010
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    • Ownergy Plc
      Your renewable energy and tariffs expert
      Advise you in selecting the appropriate options
      Design and procure suitable systems
      Structure projects for financing
      Supervise installation & commissioning
      Register and manage the tariffs
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    • Government growth forecast
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      kW
      kW
      kW
      Expected numbers of installations by size Source: DECC
    • PV FITs installations to date
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      Gross installed capacity to 2009 = 32 MW!
    • One of UK’s first solar parks
      13th October 2010
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      AD
    • One of UK’s first solar farms
      13th October 2010
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    • All this assumes ...
      ... that the Government doesn’t tinker with the tariffs in the present Spending Review
      They shouldn’t (it isn’t public spending)
      But just to be sure; sign up at:
      wesupportsolar.net
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    • Any questions?
      Websites
      About the Feed-In Tariffs:
      www.fitariffs.co.uk
      About the Renewable Heat Incentive:
      www.rhincentive.co.uk
      About Ownergy:
      www.ownergy.co.uk
      Feed-In Tariffs
      Philip Wolfe
      13th October 2010
      25
      Sunlight cash crop through Feed-In Tariffs - Philip Wolfe