Ashford pulls the plug on £1m solar panel project
Ashford Borough Council says it has been forced to pull out of a £1million solar panel scheme for its buildings after the Government proposed to slash subsidies for solar electricity production.
The ambitious scheme was due to have been rolled out this month after getting the nod from council chiefs last month. It would have seen solar panel puts on council buildings with a view to extending it eventually to council houses too.
However the proposed cut in the rates have made the proposed scheme financially unviable.
According to the government, reduced subsidies for domestic solar electricity production have been proposed as part of an urgent effort to keep the Feed-in Tariffs (FITs) scheme budget under control and reflect the plummeting costs of the technology.
The proposals, subject to consultation, would introduce a new tariff for schemes up to 4kW in size of 21p/kWh – down from the current 43.3p/kWh. Reduced rates are also proposed for schemes between 4kW and 250kW, to ensure those schemes receive a consistent rate of return.
Officers advised members of the Cabinet of the financial consequences to the solar panel project following the announcement of the government’s proposals and the leader, deputy leader and portfolio holder for environment decided the financial risks were too great.
Cllr Gerry Clarkson, deputy leader of Ashford Borough Council, said: “It is with great reluctance we have made the decision to pull the project. During these difficult economic times the council felt the potential risks to the taxpayer were too great and this was not a risk we were willing to take.
“Should circumstances change in the future we will take a view on whether to take the project forward, but only if it is in the long term interests of the borough and our residents.”
Cllr Jessamy Blanford, portfolio holder for the environment, said: “I’m personally very sad we cannot progress with the scheme. Despite this setback the council remains committed to lowering our carbon footprint and will continue to look at ways of achieving this.
“The council will be formally responding to the government’s consultation expressing disappointment with the proposals.”
The council had hoped to take advantage of the tariffs to reduce electricity bills, potentially provide the borough with an income from any power fed into the National Grid and help reduce the impact of future energy price rises to the council and its leaseholders and tenants.
Early estimates suggested an £1.2m outlay would generate a return in year five of £58,000 and up to £3.6m over 25 years; however that was before the reduced tariff rates were proposed.
Barry Nutley, of Viridis, commented “The early estimates on returns look quite low to me? The figures quoted here suggest a year one ROI of less than 5%? With the current FIT payment, I would expect that to be nearer 10% (if not more?!). Perhaps Ashford Borough Council need to revisit this, as the new lower tariff payments, may not be as bad as they first thought?”..
Barry Nutley can be contacted on 0845 437 4484, or info@viridisec.co.uk
With thanks to Kent News