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Feed-in Tariff To Drop

There has been much debate about the Government’s intention to reduce the subsidy that they provide to households that have solar photovoltaic panels fitted to their properties known as the Feed-in Tariff (FIT). Well, the Government has recently announced a change in the amount of this subsidy.

The Feed-in Tariff subsidy is being reduced on home solar panel installations of below 10Kw capacity from 1st January 2016

The Government had intended to lower the FIT from 12.47p for every kWh to only 1.63p per kWh. However, following consultations with members of the public and those within the solar panel industry it has not reduced the Feed-in Tariff as much as originally intended. Instead, the FIT subsidy is being reduced to 4.39p per kWh and this is to be with effect from the 1st January 2016.

Although the reduction is not as much as originally expected it is still a considerable drop and it will be interesting to see what sort of impact it has on the industry and homeowners. It will mean that those households having solar panels installed next year will not receive as much income from generated electricity and this will result in it taking longer to recover the cost of having solar panels installed.

As far as the industry is concerned, there have already been a number of job losses amongst some people working in the solar panel industry and it will be interesting to see if this latest announcement will see more people loosing their jobs.

The reduction in the FIT is applicable to new systems that are installed from the 1st January 2016 with a capacity of less than 10kW. Those householders that already have solar panel systems installed on the roofs of their homes or ground mounted in their gardens are not affected by the above reduction. Fortunately, there will be a number of people that have had solar panels installed before the end of this year in anticipation of the reduction in the FIT.

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