A leading energy legal firm has called on the government to deliver certainty to investors as the consultation period comes to close on proposed changes to the non-domestic RHI.
The Department of Energy and Climate Change has invited comment and feedback on its budget management plans including introducing a degression-based system similar to the one operating under the Feed-in Tariff. Installers and others in the industry have until Friday 14th September to submit their views.
Ben Halfpenny, a specialist lawyer in the Dickinson Dees Energy Team, said: “This consultation has provided an excellent opportunity to improve the long term efficiency of the RHI and to provide the future certainty around tariffs that investors in the renewables market need.
“Like investors, the government is in a difficult position as the subsidy involves projecting demand well into the future based on projects that can often take at least two years to bring online.
“The key outcome the market needs to see from the consultation is a sustainable long term regime that provides certainty in relation to the income a project can generate, or as a minimum establishes definitive parameters in relation to the extent to which tariffs may be reduced. Only then will investors be capable of making informed decisions in relation to the viability of a project.
“One proposal in the consultation is that viable projects can effectively ‘book’ their tariff in advance at a fixed level – a bit like you would book a plane ticket in advance, rather than being told the price once you are in the air. If such a system can be introduced, and the government can administer this efficiently, then it will help provide the certainty that is needed to further stimulate long-term investment which in turn is vital to meeting the UK’s 2020 target for renewable heat production as well as our broader environmental and strategic objectives in relation to carbon reduction and energy security.”
The RHI consultation document and online response system can be found here.