Installing a renewable energy source in one’s home is a fairly expensive exercise, which by its very nature limits the availability to those who can raise the funds or access it from their own resources.

The fact of the matter is that for those lucky enough to be able to afford the installation of solar PV, the benefits are huge and with Government imposed subsidies (Feed In Tariffs – FIT’s), ‘investment’ returns in double figures are easily achievable for the next 20-25 years. Where else could one achieve these returns?

Additionally, don’t forget that all these subsidies have to be paid for by someone, somehow in a two stage process:

  • Generation tariff – simply for producing
  • Export tariff – for selling any surplus over and above one’s own consumption

So who pays for the subsidies - Feed In Tariffs (FIT's)

This is just to provide a comparison - using the worst case scenario (but smallest installation & therefore cheapest) of Solar PV

Generation Tariff = £0.1490 (14.90p) per kW + Export Tariff = £0.045 (4.50p) per kW hour - giving a total subsidised price of £0.1940 (19.40p)

and at the time of writing the prices from EDF are £0.1368 (13.68p) per unit plus an annual £65.70 standing charge

The figures would seem to speak for themselves

 

It would seem as though these subsidies for the few are mutualised over the energy providers entire customer base

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The suppliers pass on the cost of the Feed-In Tariffs scheme to all their electricity customers

... so the bottom line is that people who don't install renewable energy systems pay for those who do!

 

But what about the rest of the population (i.e. those in rented accommodation or first time buyers), who simply cannot afford to play the subsidy game and yet are expected to fund the fortunate minority who have their own renewable energy sources as well as handsomely subsidised income to go with it

Has anyone actually looked at the Governments Green Energy scheme (Energy Act 2008) from the point of view of the taxpayer, energy market or simply overall fairness in general?

In reality interference in this manner by the Government has completely distorted the energy market, furthermore the imposition of additional green levies has kept the energy price un-necessarily high and disadvantaged whole sectors of the population for the benefit of a few

Whereas another approach could have been taken

  • Firstly  remove all grants and subsidies
  • Then make renewable sources (i.e. PV) a mandatory integral part of all future new build houses and offices (domestic & commercial). With 200,000 houses anticipated every year the costs of installation would plummet (£5,000 down to say £2,000) and within a very short time there would be a substantial pool of renewable energy generating properties (in 5 years 1 million homes), covering their own needs and exporting surpluses to the grid

The prices of renewable energy would then be linked to supply and demand and not kept artificially high because of ridiculous Government imposed rules and hand outs

Surely a far better approach by allowing market forces to prevail, with little Government interference and no grants or subsidies - resulting in potentially lower energy prices

And it gets even better

BIM40520 - Specific receipts: domestic microgeneration: Income Tax exemption for domestic microgeneration

With effect from tax year 2007-08 there is an exemption from Income Tax for an individual’s income from the sale of electricity generated by a microgeneration system where:

  • the system is installed at or near domestic premises occupied by the individual, and
  • the individual intends that the amount of electricity generated by the microgeneration system will not significantly exceed the amount of electricity consumed in those premises

For the purpose of this exemption ‘domestic premises’ means premises used wholly or mainly as a separate private dwelling

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The energy regulator is warning about an impending ‘energy gap’ (doom) with old power stations being phased out and not enough replacements being built to make up for the shortfall.

The consequences of this are that the UK's lights could go out and we are going to have go shopping around the world to plug this gap

This is all well and good, but what precise alternative measures has any recent UK Government taken to ameliorate the problem – very little it would seem other than paying out huge grants for wind turbines, which must be some of the most inefficient ways of producing energy imaginable, quite apart from being a complete blot on the landscape

Well how about this for an idea –

From now on, all new build houses must have a mandatory array of solar PV panels tied into the national grid which must be part of the planning application. Also no planning permission will be granted unless this provision is included

The benefits of this scheme would be enormous, especially including these ideas at the build stage, rather than having a retro-fit approach which is inevitably more expensive.

Furthermore, the sooner the UK starts down this route the better. Just work out the proposed number of houses to be built over the next 1-10 years and then calculate the contribution they will cumulatively make to the nations energy requirements. Also bear in mind that this is an on-going process that will have increased contributions for every future year

This seems a no-brainer, which is obviously a sure-fire reason for no one in Government to take it on board. Nevertheless, having a great many small power generators (individual houses increasing every year) located throughout the country would go some way towards addressing the UK’s current energy problem.

AND … if the previous Government had taken this approach 10 years ago instead of total inertia, where would be today?

Surely the message has to be - the sooner we get started on this idea the better

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