The Department of Energy and Climate Change’s latest announcement doesn’t mean the end of solar schemes in social housing
See the light
Sadly, the Department of Energy and Climate Change’s solar subsidy announcement failed to bring the certainty social housing craved.
While most of the news (such as the degressive tariff) was to be expected, the decision to hold an eight-week consultation on the rates for multiple installations was a disappointment.
It means the findings will not be returned until April, therefore reducing the 16.8p window of opportunity from five months to just three before the first rate cut comes into operation in July.
By their very scale, social landlords’ photovoltaic panel programmes have a great impact on local communities. They make a big dent in unemployment and help fuel poor tenants en masse.
DECC should have taken this opportunity to encourage landlords to kick-start their schemes. Exempting them from the additional 20 per cent rate cut would have been a good start.
Those approaching PV schemes from a ‘social’ perspective like one of our client’s, St Vincent’s Housing Association, can press on with their efforts to tackle fuel poverty, create local jobs and reduce CO2.
However, the tariff cuts from July all but spell the end of self-financing schemes in the medium term as few landlords will risk their own capital for returns that get progressively lower.
For those still considering funding their own projects, the need to act quickly has never been greater because 21p/kWh is the best the rate will ever be.
But this is far from the death knell of social housing’s solar schemes. Investor models like ours are still viable and now is the time to look at PV in a different light; social gain before commercial.
Martin Davidson is a director at Strategic Energy