The UK government is proposing steep cuts to its feed in tariffs for rooftop solar power plants, that could make the risk the entire solar industry’s prospects in that country.

The U.K.’s Department of Energy and Climate Change (DECC) has today published the outcome of its feed-in tariff (FIT) review, revealing proposals that could see the FIT rate cut by almost 90%.

From January 1, 2016, DECC is proposing to impose cuts to all bands of the FIT, and will also enforce a default rate degression every quarter. This accelerated pace of degression could see the FIT end altogether for some bands by the beginning of 2019.

DECC’s proposed generation tariffs for January next year would be as follows:

  • 0 -10kW: 1.63 pence per kWh (currently 12.47p/kWh for <4 kW)
  • 10-50kW: 3.69p/kWh (currently 11.30p/kWh for 4-50kW range)
  • 50-250kW: 2.64p/kWh (currently 9.63p/kWh (50-150kW) and 9.21p/kWh (150-250kw))
  • 250-1,000kW: 2.28p/kWh (currently 5.94p/kWh in range 250kW-5MW)
  • > 1,000kW: 1.03p/kWh (currently 5.94p/kWh).

Just imagine what could happen to demand for solar power plants if the money that the owner can make crashes by 90%!

Not surprisingly, many solar installers are weighing their options. Should these proposals come through, most installers could be switching over to related technologies that hopefully will have better demand.

Some could move into related cleantech domains such as smart meters, LED lighting and increased building insulation. Others could move back into where they came from – such as roofing and electrical engineering, according to a news item from Solar Power Portal.

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