Second part of Comprehensive Review – solar PV tariff controls

This part of the review dealt with introducing a new mechanism to control future tariff reductions for solar PV systems

However these principles are likely to apply to other technologies in the future; and Phase 2B also includes aspects relevant to solar PV.

The government’s intended action plan is available here. The original consultation document and information on responses to the consultation are available here.

The main aspects of the Phase 2A proposals are:

New PV tariffs to apply from August 2012

Although there have been huge reductions to PV tariffs between August 2011 and March 2012, further reductions are proposed from 1st August (not July as originally proposed).

The consultation offered three alternative tariff levels, depending on the deployment experienced in March and April 2012. But in the end, the government chose none of those, but the revised tariffs shown at the bottom.

The export tariff will also be adjusted from 1st August 2012 to 4.5p/kWh.

New approach to degression

The government proposes a more complex approach to degression than the straight annual percentage originally adopted.

The proposals are to combine three approaches:

  • Pre-planned degression: This would now be applied three-monthly rather than annually. The proposed rate is 3.5% every six months.
  • Contingent degression: The ability to skip up to two consecutive degression cuts if deployment is low, and to increase the percentage up to 28% if it is high.
  • Annual reviews to supplement the other mechanisms

The contingent degression adjustments will be based on three degression bands – domestic, small and large commercial.

August tariff levels

Rate:

Higher rate

Medium rate

Lower rate

Proposed PV generation tariffs from August 2012 – p/kWh
≤ 4kW 16.00 14.40 7.10
> 4kW ≤ 10kW 14.50 13.05 7.10
> 10kW ≤ 50kW 13.50 12.15 7.10
> 50kW ≤ 150kW 11.50 10.35 7.10
> 150kW ≤ 250kW 11.00 9.90 7.10
> 250kW ≤ 5,000kW 7.10 7.10 7.10
Standalone 7.10 7.10 7.10

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