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Bluefield Partners LLP, the Investment Adviser to the Bluefield Solar Income Fund Limited has made a statement following today’s publication of the Department of Energy and Climate Change (“DECC”)’s response to consultations launched this summer regarding changes to financial support for solar PV, outlining changes to the regulatory support for solar assets, including changes to the Renewable Obligation Scheme and Feed-in-Tariff accreditation; and a consultation on the level of banded support for new solar photovoltaic production under the Renewable Obligation Scheme.
The July Consultations were the Government’s response to the significant growth in the UK solar market over the past few years, which has seen the UK become the largest growth market in Europe since 2013. Whilst the changes announced will impact certain solar PV developments that are not yet installed or do not qualify for the Grace Period (as outlined below), they will have no impact on existing installed capacity of the BSIF portfolio; have no impact on the existing pipeline BSIF is currently evaluating; and create clarity around future Renewable Obligation Scheme and Feed-in-Tariff eligibility of new capacity until March 2017.
The response states that the Government will close the Renewable Obligation Scheme across Great Britain to new solar PV projects of 5MW and below, including additional capacity added to an existing accredited solar PV plant up to 5MW total installed capacity, which would mean that:
All new installations applying for Feed-in-Tariffs on or after 15 January 2016 will be subject to a new system of caps from 8 February 2016. Pre-accreditation for Feed-in-Tariffs will be re-introduced from 8 February and all applications for pre-accreditation will be subject to the new deployment caps in the same way as applications for full accreditation.
To be eligible for the Grace Period, developers must meet one of the following:
The statement goes on to say that the Government continues to consider renewables to be a key part of the transition to a low-carbon economy and an essential part of the energy mix and believes the UK is making good progress towards the EU target of 15% final energy demand from renewables by 2020 and is committed to its aim of achieving 30% of electricity from renewable sources by 2020. The UK is on track to meet its next interim target of final average energy consumption from renewables, above the 6.3% in 2013/14, as reported in June 2015. DECC believes that progress on UK renewable electricity deployment has been strong and the pipeline of projects towards 2020 remains healthy. Government expects to meet the renewable energy target of at least 30% of electricity demand to be met by renewable sources. The measures set out in the Response are about protecting bill payers from unacceptable costs in the future and ensuring that support for renewables remains affordable.
BSIF : Bluefield Solar comments on DECC response to subsidy consultation
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