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Letter to Chris Huhne from Keith House

Letter to Chris Huhne from Keith House

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Published by stephenslominski
Letter to Chris Huhne from Keith House re reductions in Feed In tariffs 2011
Letter to Chris Huhne from Keith House re reductions in Feed In tariffs 2011

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Published by: stephenslominski on Nov 22, 2011
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Chris Huhne MP Secretary of State for Energy and Climate Change

Cllr Keith House Leader of the Council
Our Ref: Date Your Ref: Contact: Direct Dial: Direct Fax: Email: CC/4/11 4 November 2011 Vince Johnston 023 8068 8077 023 8061 1528 vince.johnston@eastleigh.gov.uk

Dear Chris, Proposed Changes to the Feed in Tariff Scheme for PV Installations While I think we would all agree that some action was necessary to reform the way the PV market has been developing, we are dismayed by the recent proposed changes to the FITs scheme which are devastating for public and community bodies as well as households trying to do their bit in making a change to green energy . As you know we share beliefs and aspirations over the need for action on climate change, and the need for greater understanding, acceptance and involvement by local people and that behaviour change, as well as technological change, is necessary, if we are to achieve the UK’s carbon reduction targets. However, as a Council that has grasped the ambitions of localism and see a primary role for itself in helping, supporting, educating and leading business, local public sector organisations, community groups and residents in our locality to understand and incorporate climate change actions into the way they do things, we feel that your department’s proposals have just made that job harder. Credibility is a key part of creating momentum and getting things done. The six weeks to the reference date makes a mockery of the months we have spent going through the exhausting procurement processes that public sector organisations have to undertake, only to see a number of projects on community buildings and collaborations with other public and private sector organisations put in jeopardy. In Eastleigh, it is unlikely that the Pavilion in the Park, Y Zone, Bowls Club and Wessex House Business Centre PV projects can now go ahead. PV has been a useful way for us to start the conversation on necessary climate change actions and what people can do themselves to help – but this almost hysterical approach, which is patently designed to kill the PV market that has just started to grow, is too crude! We welcome the linking of energy performance certification or the green deal to PV, but feel this sensible initiative will be lost in the loss of credibility and mistrust which must accompany this emergency measure, and

that introducing the proposals in April would be best, setting a reference point which was dated after the consultation had ended would at least mitigate some of the damage, including the damage to individual household finances of those committed contractually to schemes which will not be delivered before 12th December 2011. The review outlines a lot of figures in its support. Looking at our own projects which are all funded via PWLB it is clear that we would only take on projects where there is a business case as we have a overarching fiduciary duty towards local taxpayers. Under these circumstances it is difficult to see how local authorities can undertake future PV projects as the PWLB rates are similar to the proposed 5% return from PV unless they have large savings. However, while many if not most residents have been unable to partake in the FITs scheme, councils have been able to take part on their behalf, using future FITs income to safeguard services and build in potential lower rises to future council tax rates. For this reason we feel that the review ought to be considering an exemption for local authorities (and possibly other public sector organisations) from the aggregation rule. Furthermore, we would urge consideration of a FITs rate for community and public buildings, or a rate for organisations whose sole purpose is to deliver community benefit and not profit. Currently, the proposed return of 4.5% will make it even more difficult to justify installation on community and operational buildings, affect future security of supply, and reduce any community benefit from FITs. As you can see from above, we take greatest issue with the 6 weeks reference date. We feel this has the potential to undermine not just the PV market, but to derail public and private confidence in the whole carbon reduction project, just at the time we will likely need it most with both the RHI and the Green Deal demanding real behavioural change. Further, it will undoubtedly have a detrimental effect on business and jobs in a time of economic uncertainty and low growth. We urge you to think again. Yours sincerely,

Cllr Keith House Leader, Eastleigh Borough Council

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