FiT degression tariff’s announced for 1 April 2014

1 February 2014

DECC has confirmed the degression rates for the Feed in Tariff due to come into force on 1 April 2014. The table below summarises the degression changes by technology and scale. For the full set of MCS and ROO-FIT statistics published by DECC you can find more information here.

Technology Scale (kW to MW) Degression from 1 April 2014
PV 0 to 10kW 3.5% automatic degression
10 to 50kW 3.5% automatic degression
>50kW No change
Hydro All bands except 2 to 5MW 5% due to capacity trigger
2 to 5MW No change
Anaerobic Digestion 0 to 500kW 20% due to capacity trigger
500kW to 5MW No change
Wind 0 to 100kW 20% due to capacity trigger
100kW to 5MW 20% due to capacity trigger

Based on the announcement it is clear that there is a significant impact on the wind and small scale anaerobic digestion sectors, due to higher levels of deployment in these areas over a 12 month period between January and December 2013. For your information, the impact on the p/kWh rate for each technology is detailed against each technology banding here. For onshore wind the 20% trigger point for deployment in 2013 was set at 86.5MW across the different scale bandings. This was significantly exceeded with total deployment for the year being registered as close to 136MW, with the majority of deployment being made in the 100kW to 5MW banding. As can be seen from the graph below this trigger was met for >100kW onshore wind in June 2013 and therefore we will be closely monitoring the impact of wind deployment in 2014 in order to make our members aware of likely triggers to be expected for 2015. Solar PV deployment levels have remained at a slow and steady level of growth with 137MW deployed in the last 3 months up to December 2013 (compared with 114MW deployed in the previous quarter). However deployment levels have not been high enough to trigger a capacity degression and tariff rates have come down based on the 3.5% mandatory degression.

As per my comments regarding the onshore wind sector we will also continue to look forward to future impacts on the tariff rates for the other FiT technologies, to provide you with additional insight into the current trends in deployment and predicting future impacts based on likely scenarios.

If you would like to discuss any of these changes please do not hesitate to contact me.

Kind regards,
Lee

Figure 1: 2013 Onshore Wind deployment (>100kW) and degression trigger point bandings