(Figures below based on Ofgem reports published 8 January 2016 for schemes which have completed accreditation. (errors in 2010/11 figures in original post)
The Impact of Feed in Tariff Review on Micro Hydro-electric Projects
The Micro Hydro Association (MHA) is shocked by the totally unexpected reduction in FIT for smaller schemes, especially for <100 kW installations. The MHA cannot compute how the new tariffs will yield a 9.2% financial return on investment, as stated by DECC. The proposed FIT will not allow hydro development to be financially viable. The collapse in base price of electricity and the complexity of direct supply does not allow ‘Renewable, no carbon electricity’ to be priced at its worth, leaving the FIT as the only mechanism through which hydro can currently be brought to market. Without a reasonable FIT this industry cannot survive. This will result in the loss of potential sustainable no carbon electricity together with the loss of a highly skilled nascent workforce and valuable working knowledge.
In light of the COP21, the MHA is dismayed that the Government are essentially withdrawing support for the Hydro industry. Hydro-electricity schemes can operate for up to 100years. Given this longevity, start-of-life financial support offers better whole life value for money than any other form of energy generation.
There are still hundreds of potential hydro sites and weirs around the British Isles which could provide sustainable energy and continue our long tradition of harnessing the power of water, but with the reduction in FIT for hydro, these Micro hydro projects will now be un-viable.
DECC’s underpinning reasons for tariff cuts:
To have changes to the News pages notified to your email account we suggest you might sign up to Blogtrotter here. Simply copy the link (URL) below and paste it into the appropriate field in Blogtrotter and add your email address.
This is a blog to replace the Latest News Page for the Micro Hydro Association so that you can use the RSS feed below. Previous News is still kept on the Home Page. From Administrator.