DECC Announce Solar PV FIT reduction likely for 2015

DECC have published the rate of registered solar PV installations for the month of August which showed a slight reduction compared to July, but no more than might have been expected due to the holiday season. Total registered installations in the 0-10kW band were nearly 32MWp compared to 34MWp in August but still higher than the 30MWp in June. This continues the trend of a gradual market recovery since the last FIT cut on 1st April.

It is expected that the automatic digression mechanism will result in a 3.5% reduction in the FIT rate for all Solar PV systems up to 50kW as of 1st January 2015 with the standard rate for systems up to 4kW due to be reduced from 14.38p/kWh down to 13.87p/kWh. The expected reduction, whilst modest, is expected to result in an increase in the number of installations over the next two months as installers and consumers rush to install systems prior to 1st January to qualify for the current higher rate.

With average system costs continuing to fall this reduction is not expected to have any long term impact on demand but with installations in Q4 2014 now expected to exceed the 100MWp threshold it is likely there will be a further 3.5% reduction on the 1st April 2015 down to 13.38p/kWh.

Ofgem are due to publish the official table of FIT rates for the period 1st January - 31st March 2015 on the 31st October 2014.

Full details of all PV registered installations can be found on the DECC website.

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