By Chris Welby, Good Energy’s Commercial Director.

Recent speculation in the press about the future of both the Feed in Tariff and the Renewable Heat Incentive (RHI) is deeply concerning.  Both are being considered in the government’s spending review and this uncertainty is damaging confidence and deterring people from investing in new renewable technologies.  So let us get a few facts straight.

1.    There is no government money in the Feed in Tariff and there does not need to be any government money in the RHI.

The Feed in Tariff costs are paid for by electricity suppliers, and ultimately by electricity consumers.  Scrapping the scheme or reducing the payout will not decrease the public deficit.  Rather, the decision by the Government to allow Local Authorities to sell electricity to the grid and claim the Feed in Tariff could provide Local Authorities with an income stream to supplement any cuts in government funding.

The RHI could be built on similar lines, but paid for by gas suppliers.  The gas industry has had a lot of support over the years from the state, something that customers off the gas network have been denied.  Arguments about needing to include Oil & LPG providers are a sideshow.  Gas suppliers, like electricity ones, are licensed and we have a template in the Feed in Tariff, so there is no reason to delay further.

2.     The Schemes do not reward the rich at the expense of the poor. 

One of the biggest growth areas in Feed in Tariff is social landlords.  Landlords can invest in the generation equipment and earn a sufficient return through the Feed in Tariff to cover that investment.  Tenants will benefit from free electricity and thus lower bills.  It’s a win-win situation.  Private landlords are also getting in on the act (see previous blog).  After all, renewable energy is probably a safer investment at the moment than buying more properties.  Local Authorities will also be getting involved pretty soon. 

The other big growth area is from entrepreneurial businesses (including some big household names) offering to install solar panels for free in return for the Feed in Tariff payment, the occupier gaining the free electricity in return.  There are schemes for all levels of society so it cannot be said to be the preserve of the rich.

With the RHI there is the added incentive of helping those off the gas grid who pay significantly more for their heating fuel.  Rural poverty is a big issue and helping to address this will also meet social objectives, especially when combined with energy efficiency.

It is difficult to address fuel poverty through social tariffs and special fuel allowances - creating social housing which needs to import very little energy from the grid is far more effective.

3.    Decentralised energy is key to energy security. 

Generating your own renewable energy is the ultimate in energy security.  There’s no reliance on third parties/government for your fuel – whether you are an individual or a country importing energy in the form of gas, oil, coal or uranium.  The UK has been lucky in the past to have fossil fuel resources from coal and more recently North Sea gas.  But these are on the decline and as a nation we are no longer self-sufficient in energy.  But we could be once again – the UK is the windiest country in Europe.  We believe that if people generate their own energy they will value it more and use it less – and we can turn the UK 100% renewable by 2050.

At heart, Feed in Tariff & RHI are not just government schemes to influence consumer behaviour.  They are energy industry schemes which can deliver on our desire to revolutionise and decarbonise the way we use and produce energy.  So please, just let us get on with it.