Government urged to improve 'feed in tariff' scheme for renewable energy

Energy bill will do little to boost small-scale renewable projects, say campaigners such as Friends of the Earth

Kathryn Hopkins guardian.co.uk, Wednesday November 05 2008 00.05 GMT

Industry groups, trades unions and green campaigners are today calling on the government to introduce a strong system of support for renewable energy known as a "feed-in tariff".

The government last week introduced an amendment to its energy bill going through parliament that would bring in a feed-in tariff (FIT) — under which small-scale producers of energy from wind turbines or solar panels are paid an above-market rate for every unit of energy they produce. FITs have proved very successful in other countries but Britain remains well behind in its deployment of renewables.

But a number of organisations including the British Retail Consortium, the Home Builders' Federation, the Co-operative Group and Friends of the Earth have written today to every member of the House of Lords expressing disappointment with the government's amendment. They are disappointed that it contains no timetable for the introduction of a FIT, does not even firmly commit the government to introducing one and has too low a cap on the amount of energy the projects could produce.

As a result, they say, the energy bill will do little to boost the development of small-scale renewable energy projects. The House of Lords will later today vote on amendments to the government's amendment in a bid to beef up the bill.

Ed Matthew, spokesman for Friends of the Earth, said: "A strong feed-in tariff is desperately needed to give homes, businesses, communities and local authorities a financial incentive to fit renewable energy systems and play a major role in tackling climate change.

"Unfortunately the government's woolly proposals are fundamentally flawed and will not guarantee that an effective scheme will be introduced. Proposals for a feed-in tariff must be strengthened to ensure that the UK reaps the benefits of its abundant supply of clean, green energy."

The new climate change secretary, David Milliband, unexpectedly announced on October 16 that he intended bringing in a FIT, something that delighted green campaigners — hence their disappointing at the lack of detail or commitment in last week's amendment.

Many other countries, led by Germany, have introduced similar measures which have proved highly successful at boosting the uptake of renewable energy by shortening the payback time on such investments. FITs have also been shown to be the most cost effective support method.