Proposals to reduce significantly available subsidies for small scale renewable energy projects could render a large number of community-owned schemes in Scotland financially unviable it has been claimed.
The warning was made by independent environmental consultants Atmos Consulting as a UK Government consultation on proposed changes to the system of feed-in tariffs closes today (23rd October).
The UK Government is currently proposing to reduce significantly the level of subsidy available for small scale renewable energy projects from the beginning of 2016. Based on its extensive experience working on more than 50 community-owned renewable energy projects in recent years, Atmos Consulting estimates that a significant number would never have gone ahead under the proposed 2016 rates.
The Scottish Government recently achieved its objective of having 500 Megawatts of community and locally owned renewable energy schemes up and running in Scotland more than four years ahead of the original target date of 2020.
Submitting evidence to the consultation, Atmos Consulting has argued that community owned projects should be given special dispensation from the new subsidy regime since they will typically find it harder to generate the necessary funding to get off the ground – as well as generally taking longer to achieve planning consent.
Speaking on behalf of Atmos Consulting, Operations Director Jean Curran said:
“Existing incentives under feed in tariffs have made community energy projects more attractive to lenders and we’ve seen steady growth in the number of community owned schemes as a consequence in recent years. But that looks set to end from the beginning of 2016. Our concern is that this places the Scottish Government’s ambitions to continue to grow the number of local and community-owned renewable energy projects at real risk. Our own analysis suggests that a large number of community projects we have worked on previously would not have been financially viable under the new 2016 feed-in tariff rates.
“Hopefully, the UK Government will listen to industry concerns as part of the current consultation and review the level of incentives available for smaller scale community owned projects under the feed-in tariffs system. That way, the positive contribution of community owned projects towards continued growth in renewables can remain on track.”