A brief update on developments since the Government’s announcement:
Articles in this issue:
- Registering your system before Dec 12th
- Campaign’s against the cuts
- Profiteering – Please be aware
- The Latest Facebook Update from Cernunnos Homes
- Please Bear With Us
- Self-Publication: join us on Twitter & Facebook
Registering your system before Dec 12th:
One of the most frequently asked questions over the last week has been: “how do we ensure we qualify for the old tariff rate?” The Government announcement stated that things had to be done to qualify for the old tariff rate:
1. The system must be commissioned. “Commissioned” was defined as being “switched-on” by an MCS accredited installer, which happens at the end of the day of installation.
AND
2. The FiT Licensee must have received the application form. The FiT Licensee is defined as your energy provider. In essence, as long as you have sent the form then you are in the clear.
There have been news articles about energy providers taking 6+ weeks to process registration forms. However, this has been the case since the beginning of the scheme. Energy providers never really caught up and have had a back-log ever since. Thus, the Government chose to state that they only needed to have received the forms.
Campaign’s against the cuts:
There have been numerous campaigns and many letters of opposition against the cuts. The opposition is coming from all quarters: installers, homeowners, businesses and even planning departments who say they are being put under intense pressure to clear the back-log of planning applications. The campaigns all seem to have a similar voice – we agree with the cuts, but that the timing is ridiculous.
The timing of the cut – whether intentionally timed to coincide with the German FiT cut or not – has caused the greatest issues. Supply chains in the Solar PV market have imploded. Some of the largest wholesaler’s simply closed down because they could not cope. Even now supply is an issue industry wide, leading to profiteering and some very unsavoury practices.
Whether anything comes out of these campaigns remains to be seen – but we will keep you updated. The latest campaign by the Solar Trade Association is calling for an extension of the tariff rate to 31st January. It can do no harm to write to your local MP, DECC or Chris Huhne himself to state your case! I did, and it didn’t harm me, but then again I think he ignored me!!
Profiteering – Please be aware:
We have become aware of some serious profiteering in the Solar PV market. Systems that were being sold and installed for under £8,000 (namely a 2kW system) are going for as much as £14,000. This doesn’t make sense and those buying those systems are being ridiculous!
Firstly, we have been informed by our largest supplier of Solar PV panels that they plan to reduce prices in mid-January by 25%. That’s 25% off the cost of the panels straight after the cut! That’s the panels only – we are not even talking about the manufacturers of inverters, or the oversupply of labour that we are going to experience. Also, this is a guaranteed price reduction by one of the largest manufacturers of PV panels in the world.
So let’s look at the economics of this: below are prices for 2, 3 and 4kW systems pre-Dec 12th FiT cut and post Jan Panel price reduction
On average, the ROI falls between 4% and 5% and the Payback period increases by around 3 to 5 years. However, we have not assumed any fall in the prices of the Inverters or lower installation costs. Whilst the price for a 2kW system now, and subsequent ROI and payback period, are really generous, they are not too bad after the cut either. In addition, we expect prices to fall even further between Jan and April, when the FiT rate will be increased in line with the RPI to around 22.2p.
Profiteering: Now let’s compare the 2kW system post Jan Panel price reductions compared to buying one now from a dubious installer (whom I must add makes me suspicious as to why he has installation dates available currently) at a cost of £14,000:
Buying one now at a cost of £14,000 makes NO ECONOMIC sense at all. You get a higher ROI and lower Payback period post-Jan! We have been guaranteed these price reductions – do not panic!
It really is a case of CAVEAT EMPTOR. Please be aware of these issues. The industry has a bad enough reputation as it is. The Government has helped to make this worse.
The Latest Facebook update from Cernunnos Homes:
Good appraisal of where we are at – we do need a sustainable industry in all renewable technologies and not the bubble that any honest installation company will admit has appeared over the last few months. Promote the good points about solar and the industry rather than crying that the subsidy, which does give phenomenal returns at the cost of the average electricity consumer is, being cut…
Please Bear With Us:
For all those awaiting an installation please bear with us. We have had issues with supply and have sorted these out. We are trying to get as many people installed, whilst being as fair as possible. We are working around the clock to ensure you still get the best possible service at the right price.
Self-Publication: join us on Twitter & Facebook
Sorry – but if you like what we send out the why not follow us on one of these social media sites!
Kind regards
Cernunnos Homes
