The Feed in Tariffs have been almost universally welcomed, but has no-one identified any flaws in the system? Well here’s an issue that people aren’t discussing:
Feed in Tariffs are a public subsidy for the rich.
Feed in Tariffs replace a capital grant scheme. Under the previous scheme anyone who wanted to install renewable energy could get help with the upfront cost. That means that people who didn’t have enough money or insufficient borrowing power could get help to install renewables. OK the previous levels of grant were pitiful, but if the money promised to Feed in Tariffs were made available as grants instead many more people could afford to install small scale renewables.
Under the Feed in Tariffs, the Government will instead subsidise energy generated from renewables, but not the cost of installation. This means that only those who can already afford the cost of installing renewable energy can benefit from it. The tariffs have clearly been set at a level to tempt those with spare cash or the ability to borrow, as the returns will be above the interest rate for some time to come. Interesting to note that Spain cancelled their Solar Feed in Tariff after investors nearly bankrupted the system using borrowed money to install solar panels in fields all over the country.
Feed in Tariffs will exclude anyone who wants to install renewables, but does not have the cash or borrowing power. In my opinion Feed in Tariffs should be cancelled and the money used to install free solar water heating for every pensioner household in the country.