Consultation on Comprehensive Review Phase 2A: Solar PV cost control

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On Thursday 24 May the Government published its response to the consultation on phase 2A of the Feed-in Tariffs Comprehensive Review: solar PV cost control.

The response document sets out the Government’s final decisions on solar PV tariffs for new installations from 1 August 2012, in line with the evidence we have seen of reductions in costs associated with solar PV. Current and future generation tariffs will be published on the Ofgem: Feed-in Tariffs web page.

The document also announces a degression mechanism for solar PV, whereby from 1 October 2012 tariffs will be set by Ofgem on a quarterly basis according to deployment earlier in the year. This builds on the best international experience and aims to remove the need for emergency reviews, consistent with our commitment to a stable, predictable future for solar PV, and for the whole FITs scheme. It will also help to keep the long-term costs of supporting solar PV down, increasing the number of people able to benefit from FITs over time.

The Government has also decided that for solar PV installations with an eligibility date on or after 1 August 2012, the export tariff will be increased to 4.5p/kWh, and the tariff period will be reduced from 25 to 20 years. In line with consultation feedback, generation tariffs for new solar PV installations will continue to be index-linked based on the Retail Price Index.

Subject to the parliamentary process required by the Energy Act 2008, these decisions will be brought into effect via modifications to the Standard Conditions of Electricity Supply Licences and associated amendments to the FITs Order that were laid before Parliament on 24 May 2012, and will come into force on 1 August 2012.



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