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Gas and Electric

Solar Feed-in-Tariff reductions delayed - is it all good news though?

Like many people in the solar industry were suggesting, the government has postponed the reductions to the Feed-in-Tariff (FiT) from July 1st to August 1st, but is this news as good as it seems?

It is worth looking at what else has changed with the FiT, and along with the date for the reduction, one of the main things is the duration that you will receive the payments for. This has been reduced from 25 years down to 20 years, which could mean a potential loss of £20,000 in cumulative payments.

Also, its worth remembering that the FiT is still definitely being reduced by 24% from 21p to 16p, and the tariff will be reduced every 3 months thereafter to maintain a return of 6% - 8% on your investment. One small positive comment is that the DECC will look at sales figures and installation costs for each potential reduction and possibly delay the date where applicable.

Obviously installing before August 1st will provide homeowners with a much higher yearly payment, and for 5 more years than those who install after August 1st, so expect solar installers to reach their capacity for installation dates in June over the next few weeks.