PV financial incentives
Encyclopedia
Financial incentives for photovoltaics are incentives offered to electricity consumers to install and operate solar-electric generating systems, also known as photovoltaics
(PV). A government may offer incentives in order to encourage the PV industry to achieve the economies of scale
needed to compete where the cost of PV-generated electricity is above the cost from the existing grid. Such policies are implemented to promote national or territorial energy independence
, high tech
job creation and reduction of carbon dioxide emissions which cause global warming.
When, in a given country or territory, the cost of solar electricity falls to meet the rising cost of grid electricity, then 'grid parity' is reached, and in principle incentives are no longer needed. In some places, the price of electricity varies as a function of time and day (due to demand variations). In places where high demand (and high electricity prices) coincide with high sunshine (usually hot places with air conditioning) then grid parity is reached before the cost solar electricity meets the average price of grid electricity.
Investment subsidies
With investment subsidies, the financial burden falls upon the taxpayer, while with feed-in tariffs the extra cost is distributed across the utilities' customer bases. While the investment subsidy may be simpler to administer, the main argument in favour of feed-in tariffs is the encouragement of quality. Investment subsidies are paid out as a function of the nameplate capacity of the installed system and are independent of its actual power yield over time, so reward overstatement of power, and tolerate poor durability and maintenance.
Feed-in Tariffs (FiT)
With feed-in tariffs, the initial financial burden falls upon the consumer. Feed-in tariffs reward the number of kilowatt-hours produced over a long period of time, but because the rate is set by the authorities may result in overpayment of the owner of the PV installation. The price paid per kWh under a feed-in tariff exceeds the price of grid electricity.
Net metering
"Net metering" refers to the case where the price paid by the utility is the same as the price charged, often achieved by having the electricity meter spin backwards as electricity produced by the PV installation in excess of the amount being used by the owner of the installation is fed back into the grid.
Solar Renewable Energy Credits (SRECs)
Alternatively, SRECs allow for a market mechanism to set the price of the solar generated electricity subsidy. In this mechanism, a renewable energy production or consumption target is set, and the utility (more technically the Load Serving Entity) is obliged to purchase renewable energy or face a fine (Alternative Compliance Payment or ACP). The producer is credited for an SREC for every 1,000 kWh of electricity produced. If the utility buys this SREC and retires it, they avoid paying the ACP. In principle this system delivers the cheapest renewable energy, since the all solar facilities are eligible and can be installed in the most economic locations. Uncertainties about the future value of SRECs has led to long-term SREC contract markets to give clarity to their prices and allow solar developers to pre-sell/hedge their SRECs.
Quick overview
Smart meter
s allow the retail price to vary as a function of time ("time of use pricing")http://www.firstenergycorp.com/Residential_and_Business/Customer_Choice/New_York/Small_Business_-_Time-Of-Use_Pricing_Options.html. When demand is high the retail price is high and vice versa. With time-of-use pricing, when peak demand coincides with hot sunny days, the cost of solar electricity is closer to the price of grid electricity, and grid parity will be reached earlier than if one single price were used for grid electricity.
The Japanese government through its Ministry of International Trade and Industry ran a successful programme of subsidies from 1994 to 2003. By the end of 2004, Japan led the world in installed PV capacity with over 1.1 GW.http://www.oja-services.nl/iea-pvps/isr/22.htm
In 2004, the German government introduced the first large-scale feed-in tariff system, under a law known as the 'EEG' (see below) which resulted in explosive growth of PV installations in Germany. At the outset the Feed-in Tariff (FIT) was over 3x the retail price or 8x the industrial price. The principle behind the German system is a 20 year flat rate contract. The value of new contracts is programmed to decrease each year, in order to encourage the industry to pass on lower costs to the end users.
In October 2008, Spain, Italy, Greece and France introduced feed-in tariffs. None have replicated the programmed decrease of FIT in new contracts though, making the German incentive less attractive compared to other countries. The French FIT offers a uniquely high premium for building integrated systems.
In 2006 California approved the 'California Solar Initiative
', offering a choice of investment subsidies or FIT
for small and medium systems and a FIT for large systems. The small-system FIT of $0.39 per kWh (far less than EU countries) expires in just 5 years, and the residential investment incentive is overwhelmed by a newly required time-of-use tariff, with a net cost increase to new systems. All California incentives are scheduled to decrease in the future depending as a function of the amount of PV capacity installed.
At the end of 2006, the Ontario Power Authority (Canada) began its Standard Offer Program (http://www.powerauthority.on.ca/sop/), the first in North America for small renewable projects (10MW or less). This guarantees a fixed price of $0.42 CDN per kWh for PV and $0.11 CDN per kWh for other sources (i.e., wind, biomass, hydro) over a period of twenty years. Unlike net metering, all the electricity produced is sold to the OPA at the SOP rate. The generator then purchases any needed electricity at the current prevailing rate (e.g., $0.055 per kWh). The difference should cover all the costs of installation and operation over the life of the contract.
The price per Kilowatt hour (kWh) or kWp of the FIT or investment subsidies is only one of three factors that stimulate the installation of PV. The other two factors are insolation (the more sunshine, the less capital is needed for a given power output) and administrative ease of obtaining permits and contracts (Southern European countries are reputedly complex). For example Greece, at the end of 2008, had 3GWp of permit requests unprocessed and halted new applications http://www.helapco.gr/library/25_11_08/New-FIT-Greece_26Nov08.pdf.
Bulgarian regulator DKER
Remuneration for 25 year contract, with possible next year changes set related to 2 components (electricity sales price previous year, RES component).
The program was launched in September 2009 and the tariffs were fixed then. The solar projects ≤10 kW received $0.802, however, as of 13 August 2010 ground mounted systems will receive a lower tariff than rooftop mounted systems.
Feed-In tariff rates for the Ontario Power Authority (OPA) FIT and MicroFIT Programs, for renewable generation capacity of 10 MW or less, connected at 50 kV:
Rooftop ≤10 kW $0.802/kWh CDN
Ground Mounted ≤10 kW $0.642/kWh CDN
Rooftop > 10 ≤ 250 kW $0.713/kWh CDN
Rooftop > 250 ≤ 500 kW $0.635/kWh CDN
Rooftop > 500 kW $0.539/kWh CDN
Ground Mounted2 > 10 kW $0.443/kWh CDN
Tariffs vary based on fuel type and size of installation http://fit.powerauthority.on.ca/Storage/102/11122_FIT_Price_Schedule_August_13_2010.pdf. The contract duration with the OPA is 20 years, with a constant remuneration for solar, though biomass, biogas, hydro, and wind receive a 20% of Consumer Price Index price adder. Additionally, biomass, biogas, hydro receive a 35% peak demand adder during peak demand periods of the day and -10% off peak. Finally, all but solar may also qualify for a community and aboriginal price adder. All power produced is sold to the OPA. Generator then purchases back what is needed at prevailing rate (e.g., $0.055/kWh CDN). The intent of the Feed-In Tariff program is to provide an 11% return on investment.
and is about us$0.15 per kWh.
Situation as of 2009
Backed by the Chinese government’s total stimulus package of RMB 4 trillion ($585bn), Chinese businesses are now among the top producers of electric vehicles, wind turbines, solar panels and energy efficient appliances, according to a report released last month by London-based The Climate Group. In March 2009, the China government introduced the "Solar Roofs Plan" for promoting the application of solar PV building. The Ministry of Finance in July re-introduced the "Golden Sun Project" with more specific details of the related policy. The policy provides that the grid-connected photovoltaic power generation project, the state will in principle by photovoltaic power generation system and its supporting transmission and distribution projects to give 50% of the total investment subsidies. The subsidy will rise to 70% for solar power systems in remote areas that are not currently connected to the grid. Projects with a minimum capacity of 500MW would be eligible for the related incentive. All such financial incentive schemes boosts most of the new development in China solar market, such as the new thin film solar plant of Anwell Technologies and Tianwei, as well as the contract signed by LDK solar to install up to 500 MW of capacity of PV stations over the next five years in Jiangsu Province of China.
However, there still is no clarity on Feed-in-Tariffs for domestic installations within China.
Legal basis: Arrêté du 12 janvier 2010
Feed-in Tariffs:
Contract duration 20 years, linked to inflation.
Additional investment subsidies available as tax credits.
Each year, starting from 2012, the new contracts will be 10% lower than the previous year.
Only 1500 kWh/kWp per year are bought from any fixed installation in mainland (2200 for tracking). In DOM-TOM and Corsica, the caps for fixed and tracking installation are respectively 1800 and 2600.
Grid operators are legally obliged to pay producers of solar electricity a fixed remuneration (feed-in tariff or FIT) for solar generated electricity fed into the grid, depending on the size and type of the system, as well as the year of installation. The tariffs vary to account for the different costs of rooftop or ground-mounted systems in accordance with the size of the system and system cost reductions over time. Since the EEG guarantees the FIT-payments for a duration of 20 years, it provides sustained planning security for investors in PV systems.
The feed-in tariff, in force since 1 August 2004, was modified in 2008. In view of the unexpectedly high growth rates, the depreciation was accelerated and a new category (>1000 kWp) was created with a lower tariff. The facade premium was abolished. In July 2010, the Renewable Energy Sources Act was again amended to reduce the tariffs by a further 16% in addition to the normal annual depreciation, as the prices for PV-panels had dropped sharply in 2009. The most recent modification of the EEG occurred in 2011, when part of the degression foreseen for 2012 was brought forward to mid 2011 as a response to unexpectedly high installations in the course of 2010.
Contract duration 20 years, constant remuneration. Feed-in tariffs will be lower in value in future years (decreasing by 9% default and a maximum of 24% per year). Degression will be accelerated or slowed down by three percentage points for every 1000 MWp/a divergence from the target of 3500 MWp/a.
New PV FIT law introduced 15 Jan 2009
Feed-in Tariffs (EUR/kWh)
Contract duration 20 years, indexed to 25% of annual inflation.
New contract prices to reduce 1% per month starting 2010
Special program with higher FIT but no tax rebates planned to drive 750MWp installations of BIPV.
Investment subsidies: Tax rebates and grants (40%) are available.
.
State Utilities are mandated to buy green energy via a Power Purchase Agreement from Solar Farms
The Ministry of New and Renewable Energy has launched a new scheme (Jan 2008) for installation of Solar Power Plants. For the producer, a Generation-based subsidy is available up to Rs. 12/kWh (€ 0.21/kWh) from the Ministry of New and Renewable Energy, in addition to the price paid by the State Utility for 10 years.
The State Electricity Regulatory Commissions are setting up preferential tariffs for Solar Power
Rajasthan - Rs. 15.6 (€ 0.27) per kWh (proposed)
West Bengal - Rs. 12.5 (€ 0.22) per kWh (proposed)
Punjab - Rs. 8.93 (€ 0.15) per kWh
80% accelerated depreciation
Concessional duties on import of raw materials
Excise duty exemption on certain devices
Contract duration 20 years, constant remuneration.
On March 8th, 2011, a government decree has cancelled this regime: new installations from June 1st, 2011, will receive lower tariffs. The exact amounts will be decided during the month of April 2011.
As of October 2009
As of July 2010
Contract duration 20 years
Contract duration 15 years
10% decreasing in 2011.
Feed-in Tariffs:
Additional subsidies available.
Contract duration 15 years, constant remuneration
No change since September 2008: the legal framework is the Real Decreto (royal decree)1578/2008 replacing 436/2004 modified by Real Decreto 1634/2006.
Feed-in Tariff:
Building mounted
Ground mounted
These feed in tariffs are capped at approximately 500MWp/y, of which 241MW ground mounted, 233MWp building mounted >20MWp, 26.7 MW <20MWp building mounted.
The Bureau of Energy under Taiwan's Ministry of Economic Affairs (MOEA) has announced the proposed feed-in tariff rates for photovoltaic (PV) and other types of renewable energy in September. A tentative rates of NT$8.1243-9.3279 (US$0.250-0.287) per kilowatt-hour (kwh) has been set for PV generated power, however, the proposed rates have fallen considerably short of local solar players' expectations. Public hearing will be held on 24 Sept to collect opinions from all parties concerned.
Announcements in the press that Turkey will introduce a new feed in tariff for photovoltaic; €0.28/kWh for the first ten years and €0.22 for another ten years.
_ This mainly covers PV but other technologies can be found from DECC.gov.uk
UK Feed-in Tariffs The UK Government has introduced a feed-in tariff for small scale (up to 5MW) renewables from 1 April 2010, with a review in 2012 for changes on 1 April 2013. Though limits on max MWp installations will be announced in December to steer away from large solar utilities.
43.3 p/kWh < 4kW > 37.9 p/kWh < 10kW > 32.8 p/kWh < 100kW > 30.7 p/kWh
i.e. 43.3 pence/kWh fed in from a less than (or equals?) 4kW peak power installation
37.9 p/kWh for >(or=?) 4kW <(or=?) 10kW
32.8 p/kWh for >(or=?) 10kW <(or=?) 100kW
30.7 p/kWh for >(or=?) 100kW
Stand alone installation: 30.7 p/kWh
From 1 August 2011, the tariff rate for > 50 KWp will be 19.0 p/kwh.
Typical domestic (< 4kW peak?) installations registered (on or?) after Dec 12th 2011 will attract only (~)21 p/kWh.
Legislation currently under consideration in Congress:
“Renewable Energy and Job Creation Act of 2008.” Full text at http://thomas.loc.gov/cgi-bin/bdquery/z?d110:HR06049:@@@L&summ2=m&. This multifaceted energy bill would extend investment tax credit. By June 2008, it had passed the House
but had not overcome opposition from Senate
Republicans
who had filibuster
ed it over tax provisions that would finance the program http://www.greentechmedia.com/articles/senate-blocks-renewable-incentives-bill-992.html. In September 2008, it passed in the Senate with amendments.
Administrative basis: California Public Utilities Commission (PUC) decision of Aug. 24, 2006
Feed-in Tariffs and Investment subsidies :
Contract duration 5 years, constant remuneration
Net metering
Approved equipment
(RPS) under Amendment 37 in November 2004. amended in March 2007
Investor-owned utilities
serving 40,000 or more customers to generate or purchase 10% of their retail electric sales from renewable-energy resources as well as a rebate program for customers
Utilities must provide increasing proportions of renewable or recycled energy
in their electricity sales in Colorado:
3% in 2007; 5% in 2008-2010; 10% in 2011-2014; 15% in 2015-2019; and 20% in 2020 and thereafter.
At least 4% of the standard must be generated by solar-electric technologies, half of which must be generated at the customer.
Cooperatives and municipal utilities must follow a lower scale culminating in 10% in 2020.
The 2007 amendments directed the Colorado Public Utility Commission (PUC) to revise or clarify its existing RPS rules on or before October 1, 2007. The PUC's rules generally apply to investor-owned utilities.
According to Green Power Network in 2006, U.S. tradable renewable energy credits (RECs) traded between ¢0.5 and 9.0/kWh. Many were at ¢2/kWh ($5–90/MWh)
Net metering
::
Photovoltaics
Photovoltaics is a method of generating electrical power by converting solar radiation into direct current electricity using semiconductors that exhibit the photovoltaic effect. Photovoltaic power generation employs solar panels composed of a number of solar cells containing a photovoltaic material...
(PV). A government may offer incentives in order to encourage the PV industry to achieve the economies of scale
Economies of scale
Economies of scale, in microeconomics, refers to the cost advantages that an enterprise obtains due to expansion. There are factors that cause a producer’s average cost per unit to fall as the scale of output is increased. "Economies of scale" is a long run concept and refers to reductions in unit...
needed to compete where the cost of PV-generated electricity is above the cost from the existing grid. Such policies are implemented to promote national or territorial energy independence
Energy independence
The following articles relate to the topic of energy independence:* Energy resilience* Energy security* North American energy independence* Swedish Commission on Oil Independence* United States energy independence...
, high tech
High tech
High tech is technology that is at the cutting edge: the most advanced technology currently available. It is often used in reference to micro-electronics, rather than other technologies. The adjective form is hyphenated: high-tech or high-technology...
job creation and reduction of carbon dioxide emissions which cause global warming.
When, in a given country or territory, the cost of solar electricity falls to meet the rising cost of grid electricity, then 'grid parity' is reached, and in principle incentives are no longer needed. In some places, the price of electricity varies as a function of time and day (due to demand variations). In places where high demand (and high electricity prices) coincide with high sunshine (usually hot places with air conditioning) then grid parity is reached before the cost solar electricity meets the average price of grid electricity.
Mechanisms
Four incentive mechanisms are used (often in combination):- Investment subsidiesSubsidyA subsidy is an assistance paid to a business or economic sector. Most subsidies are made by the government to producers or distributors in an industry to prevent the decline of that industry or an increase in the prices of its products or simply to encourage it to hire more labor A subsidy (also...
: the authorities refund part of the cost of installation of the system. - Feed-in TariffFeed-in TariffA feed-in tariff is a policy mechanism designed to accelerate investment in renewable energy technologies. It achieves this by offering long-term contracts to renewable energy producers, typically based on the cost of generation of each technology...
s/net meteringNet meteringNet metering is an electricity policy for consumers who own renewable energy facilities or V2G electric vehicles. "Net", in this context, is used in the sense of meaning "what remains after deductions" — in this case, the deduction of any energy outflows from metered energy inflows...
: the electricity utility buys PV electricity from the producer under a multiyear contract at a guaranteed rate. - Solar Renewable Energy CertificatesSolar Renewable Energy CertificatesSolar Renewable Energy Certificates or Solar Renewable Energy Credits are a form of Renewable Energy Certificate or "Green tag". SRECs exist in states that have Renewable Portfolio Standard legislation with specific requirements for solar energy, usually referred to as a "solar carve-out"...
("SRECs")
Investment subsidies
With investment subsidies, the financial burden falls upon the taxpayer, while with feed-in tariffs the extra cost is distributed across the utilities' customer bases. While the investment subsidy may be simpler to administer, the main argument in favour of feed-in tariffs is the encouragement of quality. Investment subsidies are paid out as a function of the nameplate capacity of the installed system and are independent of its actual power yield over time, so reward overstatement of power, and tolerate poor durability and maintenance.
Feed-in Tariffs (FiT)
With feed-in tariffs, the initial financial burden falls upon the consumer. Feed-in tariffs reward the number of kilowatt-hours produced over a long period of time, but because the rate is set by the authorities may result in overpayment of the owner of the PV installation. The price paid per kWh under a feed-in tariff exceeds the price of grid electricity.
Net metering
"Net metering" refers to the case where the price paid by the utility is the same as the price charged, often achieved by having the electricity meter spin backwards as electricity produced by the PV installation in excess of the amount being used by the owner of the installation is fed back into the grid.
Solar Renewable Energy Credits (SRECs)
Alternatively, SRECs allow for a market mechanism to set the price of the solar generated electricity subsidy. In this mechanism, a renewable energy production or consumption target is set, and the utility (more technically the Load Serving Entity) is obliged to purchase renewable energy or face a fine (Alternative Compliance Payment or ACP). The producer is credited for an SREC for every 1,000 kWh of electricity produced. If the utility buys this SREC and retires it, they avoid paying the ACP. In principle this system delivers the cheapest renewable energy, since the all solar facilities are eligible and can be installed in the most economic locations. Uncertainties about the future value of SRECs has led to long-term SREC contract markets to give clarity to their prices and allow solar developers to pre-sell/hedge their SRECs.
Quick overview
Smart meter
Smart meter
A smart meter is usually an electrical meter that records consumption of electric energy in intervals of an hour or less and communicates that information at least daily back to the utility for monitoring and billing purposes. Smart meters enable two-way communication between the meter and the...
s allow the retail price to vary as a function of time ("time of use pricing")http://www.firstenergycorp.com/Residential_and_Business/Customer_Choice/New_York/Small_Business_-_Time-Of-Use_Pricing_Options.html. When demand is high the retail price is high and vice versa. With time-of-use pricing, when peak demand coincides with hot sunny days, the cost of solar electricity is closer to the price of grid electricity, and grid parity will be reached earlier than if one single price were used for grid electricity.
The Japanese government through its Ministry of International Trade and Industry ran a successful programme of subsidies from 1994 to 2003. By the end of 2004, Japan led the world in installed PV capacity with over 1.1 GW.http://www.oja-services.nl/iea-pvps/isr/22.htm
In 2004, the German government introduced the first large-scale feed-in tariff system, under a law known as the 'EEG' (see below) which resulted in explosive growth of PV installations in Germany. At the outset the Feed-in Tariff (FIT) was over 3x the retail price or 8x the industrial price. The principle behind the German system is a 20 year flat rate contract. The value of new contracts is programmed to decrease each year, in order to encourage the industry to pass on lower costs to the end users.
In October 2008, Spain, Italy, Greece and France introduced feed-in tariffs. None have replicated the programmed decrease of FIT in new contracts though, making the German incentive less attractive compared to other countries. The French FIT offers a uniquely high premium for building integrated systems.
| France - Tarif d’Achat Photovoltaïque (2009) Installation Type Feed-in-tariff Continental France Overseas Departments Remark Roof & ground-mounted 0.3 Euro / kWh 0.4 Euro / kWh 1. Duration: 20 years BIPV 0.55 Euro / kWh 0.55 Euro / kWh Focus on BIPV National Target: 160MW by 2010 / 450MW by 2015 Tax credit for income tax payer: 50% reimbursement on equipment cost |
In 2006 California approved the 'California Solar Initiative
California Solar Initiative
California Solar Initiative is a renewable energy program in the United States.As part of Governor Arnold Schwarzenegger's Million Solar Roofs Program, California has set a goal to create 3,000 megawatts of new, solar-produced electricity by 2016 — moving the state toward a cleaner energy future...
', offering a choice of investment subsidies or FIT
Feed-in Tariff
A feed-in tariff is a policy mechanism designed to accelerate investment in renewable energy technologies. It achieves this by offering long-term contracts to renewable energy producers, typically based on the cost of generation of each technology...
for small and medium systems and a FIT for large systems. The small-system FIT of $0.39 per kWh (far less than EU countries) expires in just 5 years, and the residential investment incentive is overwhelmed by a newly required time-of-use tariff, with a net cost increase to new systems. All California incentives are scheduled to decrease in the future depending as a function of the amount of PV capacity installed.
At the end of 2006, the Ontario Power Authority (Canada) began its Standard Offer Program (http://www.powerauthority.on.ca/sop/), the first in North America for small renewable projects (10MW or less). This guarantees a fixed price of $0.42 CDN per kWh for PV and $0.11 CDN per kWh for other sources (i.e., wind, biomass, hydro) over a period of twenty years. Unlike net metering, all the electricity produced is sold to the OPA at the SOP rate. The generator then purchases any needed electricity at the current prevailing rate (e.g., $0.055 per kWh). The difference should cover all the costs of installation and operation over the life of the contract.
The price per Kilowatt hour (kWh) or kWp of the FIT or investment subsidies is only one of three factors that stimulate the installation of PV. The other two factors are insolation (the more sunshine, the less capital is needed for a given power output) and administrative ease of obtaining permits and contracts (Southern European countries are reputedly complex). For example Greece, at the end of 2008, had 3GWp of permit requests unprocessed and halted new applications http://www.helapco.gr/library/25_11_08/New-FIT-Greece_26Nov08.pdf.
Australia
Australia is a federation of states and territories. Each state has different laws regarding feed-in tariffs. The states have a range of policies from no feed-in tariffs to feed-in tariffs at more than double the normal consumer price of electricity. Some states are considering feed-in tariffs but have not yet enacted relevant legislation, or the legislation has not yet come into effect. Only a small proportion are Gross Feed-in tariffs (proposed NSW and ACT), most are on a net basis. In the Northern Territory at present only the Alice Springs Solar City is eligible for feed-in tariffs for solar PV.Bulgaria
Situation as of April 1, 2010- <=5kWp 792.89 Leva/MWh (about Eur 0.405/kWh)
- >5kWp 728.29 Leva/MWh (about Eur 0.372/kWh)
Bulgarian regulator DKER
Remuneration for 25 year contract, with possible next year changes set related to 2 components (electricity sales price previous year, RES component).
Canada
Overview of Federal and provincial incentives at CanSIA. Only Ontario offers significant incentive.Ontario
In 2006 the Ontario Power Authority introduced the Renewable Energy Standard Offer Program. This program was replaced with the 2009 Feed-In Tariff program for renewable energy (FIT). The FIT program is further divided into the MicroFIT program for projects less than 10 kW, designed to encourage individuals and households to generate renewable energy.The program was launched in September 2009 and the tariffs were fixed then. The solar projects ≤10 kW received $0.802, however, as of 13 August 2010 ground mounted systems will receive a lower tariff than rooftop mounted systems.
Feed-In tariff rates for the Ontario Power Authority (OPA) FIT and MicroFIT Programs, for renewable generation capacity of 10 MW or less, connected at 50 kV:
- Solar Photovoltaic:
Rooftop ≤10 kW $0.802/kWh CDN
Ground Mounted ≤10 kW $0.642/kWh CDN
Rooftop > 10 ≤ 250 kW $0.713/kWh CDN
Rooftop > 250 ≤ 500 kW $0.635/kWh CDN
Rooftop > 500 kW $0.539/kWh CDN
Ground Mounted2 > 10 kW $0.443/kWh CDN
- Wind, Hydro, Biomass: from $0.111 up to $0.195/kWh CDN
Tariffs vary based on fuel type and size of installation http://fit.powerauthority.on.ca/Storage/102/11122_FIT_Price_Schedule_August_13_2010.pdf. The contract duration with the OPA is 20 years, with a constant remuneration for solar, though biomass, biogas, hydro, and wind receive a 20% of Consumer Price Index price adder. Additionally, biomass, biogas, hydro receive a 35% peak demand adder during peak demand periods of the day and -10% off peak. Finally, all but solar may also qualify for a community and aboriginal price adder. All power produced is sold to the OPA. Generator then purchases back what is needed at prevailing rate (e.g., $0.055/kWh CDN). The intent of the Feed-In Tariff program is to provide an 11% return on investment.
Czech Republic
As of 2010 feed-in tariffs are 12.25 CZK/kWh for <=30kWp and 12.15 for >30 kWp. Contract duration is 20 years with yearly increase linked to inflation (within range 2 - 4 %). New contract prices are changed for 5 % yearly, due to unexpected rise of number of installations in 2009 new bill is proposed allowing 25 % change.China
As of August 2011 a national feed-in tariff for solar projects was issued,and is about us$0.15 per kWh.
Situation as of 2009
Backed by the Chinese government’s total stimulus package of RMB 4 trillion ($585bn), Chinese businesses are now among the top producers of electric vehicles, wind turbines, solar panels and energy efficient appliances, according to a report released last month by London-based The Climate Group. In March 2009, the China government introduced the "Solar Roofs Plan" for promoting the application of solar PV building. The Ministry of Finance in July re-introduced the "Golden Sun Project" with more specific details of the related policy. The policy provides that the grid-connected photovoltaic power generation project, the state will in principle by photovoltaic power generation system and its supporting transmission and distribution projects to give 50% of the total investment subsidies. The subsidy will rise to 70% for solar power systems in remote areas that are not currently connected to the grid. Projects with a minimum capacity of 500MW would be eligible for the related incentive. All such financial incentive schemes boosts most of the new development in China solar market, such as the new thin film solar plant of Anwell Technologies and Tianwei, as well as the contract signed by LDK solar to install up to 500 MW of capacity of PV stations over the next five years in Jiangsu Province of China.
However, there still is no clarity on Feed-in-Tariffs for domestic installations within China.
France
Situation as of 2010. http://www.legifrance.gouv.fr/affichTexte.do?cidTexte=JORFTEXT000021673951&dateTexte=&categorieLien=idLegal basis: Arrêté du 12 janvier 2010
Feed-in Tariffs:
- Building integrated on houses, hospitals, schools : EUR 0.58/kWh
- Building integrated on other buildings : EUR 0.50/kWh
- Semi-integrated (the PV panels are located on buildings but do not have any architectural function) : EUR 0.42/kWh
- Ground-mounted PV in DOM-TOM and Corsica : EUR 0.40/kWh
- Ground-mounted PV <250 kWp in mainland : EUR 0.314/kWh
- Ground-mounted PV >250 kWp in mainland : EUR 0.314 – 0.3768/kWh according to the administrative region
Contract duration 20 years, linked to inflation.
Additional investment subsidies available as tax credits.
Each year, starting from 2012, the new contracts will be 10% lower than the previous year.
Only 1500 kWh/kWp per year are bought from any fixed installation in mainland (2200 for tracking). In DOM-TOM and Corsica, the caps for fixed and tracking installation are respectively 1800 and 2600.
Germany
The German Renewable Energy Sources Act (Erneuerbare-Energien-Gesetz – EEG) came into effect in 2000 and has been adapted by many countries around the world. It was amended several times and triggered an unprecedented boom in solar electricity production. This success is largely due to the creation of favourable political framework conditions.Grid operators are legally obliged to pay producers of solar electricity a fixed remuneration (feed-in tariff or FIT) for solar generated electricity fed into the grid, depending on the size and type of the system, as well as the year of installation. The tariffs vary to account for the different costs of rooftop or ground-mounted systems in accordance with the size of the system and system cost reductions over time. Since the EEG guarantees the FIT-payments for a duration of 20 years, it provides sustained planning security for investors in PV systems.
The feed-in tariff, in force since 1 August 2004, was modified in 2008. In view of the unexpectedly high growth rates, the depreciation was accelerated and a new category (>1000 kWp) was created with a lower tariff. The facade premium was abolished. In July 2010, the Renewable Energy Sources Act was again amended to reduce the tariffs by a further 16% in addition to the normal annual depreciation, as the prices for PV-panels had dropped sharply in 2009. The most recent modification of the EEG occurred in 2011, when part of the degression foreseen for 2012 was brought forward to mid 2011 as a response to unexpectedly high installations in the course of 2010.
| type | 2004 | 2005 | 2006 | 2007 | 2008 | 2009 | 2010 | Jul 2010 | Okt 2010 | 2011 | |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Rooftop mounted | up to 30 kW | 57,4 | 54,53 | 51,80 | 49,21 | 46,75 | 43,01 | 39,14 | 34,05 | 33,03 | 28,74 |
| between 30 kW and 100 kW | 54,6 | 51,87 | 49,28 | 46,82 | 44,48 | 40,91 | 37,23 | 32,39 | 31,42 | 27,33 | |
| above 100 kW | 54,0 | 51,30 | 48,74 | 46,30 | 43,99 | 39,58 | 35,23 | 30,65 | 29,73 | 25,86 | |
| above 1000 kW | 54,0 | 51,30 | 48,74 | 46,30 | 43,99 | 33,00 | 29,37 | 25,55 | 24,79 | 21,56 | |
| Ground mounted | conversion areas | 45,7 | 43,4 | 40,6 | 37,96 | 35,49 | 31,94 | 28,43 | 26,16 | 25,37 | 22,07 |
| agricultural fields | 45,7 | 43,4 | 40,6 | 37,96 | 35,49 | 31,94 | 28,43 | - | - | - | |
| other | 45,7 | 43,4 | 40,6 | 37,96 | 35,49 | 31,94 | 28,43 | 25,02 | 24,26 | 21,11 | |
Contract duration 20 years, constant remuneration. Feed-in tariffs will be lower in value in future years (decreasing by 9% default and a maximum of 24% per year). Degression will be accelerated or slowed down by three percentage points for every 1000 MWp/a divergence from the target of 3500 MWp/a.
Greece
Situation as of 2009. http://www.helapco.gr/library/19-01-09/New_PV_Law_Greece_19Jan09.pdfNew PV FIT law introduced 15 Jan 2009
Feed-in Tariffs (EUR/kWh)
| System size (kWp) | Mainland | Island |
|---|---|---|
| ≤ 100 kWp | 0.45 | 0.50 |
| >100 kWp | 0.40 | 0.45 |
Contract duration 20 years, indexed to 25% of annual inflation.
New contract prices to reduce 1% per month starting 2010
Special program with higher FIT but no tax rebates planned to drive 750MWp installations of BIPV.
Investment subsidies: Tax rebates and grants (40%) are available.
India
The Indian Renewable Energy Development Agency (IREDA) provides revolving fund to financing and leasing companies offering affordable credit for the purchase of PV systems in IndiaSolar power in India
India is densely populated and has high solar insolation, an ideal combination for using solar power in India. India is already a leader in wind power generation...
.
State Utilities are mandated to buy green energy via a Power Purchase Agreement from Solar Farms
The Ministry of New and Renewable Energy has launched a new scheme (Jan 2008) for installation of Solar Power Plants. For the producer, a Generation-based subsidy is available up to Rs. 12/kWh (€ 0.21/kWh) from the Ministry of New and Renewable Energy, in addition to the price paid by the State Utility for 10 years.
The State Electricity Regulatory Commissions are setting up preferential tariffs for Solar Power
Rajasthan - Rs. 15.6 (€ 0.27) per kWh (proposed)
West Bengal - Rs. 12.5 (€ 0.22) per kWh (proposed)
Punjab - Rs. 8.93 (€ 0.15) per kWh
80% accelerated depreciation
Concessional duties on import of raw materials
Excise duty exemption on certain devices
Italy
The Ministry for Industry issued a decree on 5 August 2005 that provides the legal framework for the system known as "Conto Energia". The following incentive tariffs are from the decree of 19 Feb 2007.| System size in kWp | Free-standing | Semi-integrated | Integrated |
|---|---|---|---|
| 1 to 3 | 0.40 | 0.44 | 0.49 |
| 3 to 20 | 0.38 | 0.42 | 0.46 |
| 20 or more | 0.36 | 0.40 | 0.44 |
Contract duration 20 years, constant remuneration.
On March 8th, 2011, a government decree has cancelled this regime: new installations from June 1st, 2011, will receive lower tariffs. The exact amounts will be decided during the month of April 2011.
Japan
The former incentive programme run by the Ministry of Economy, Trade and Industry was stopped in 2005.Macedonia (Former Yugoslav Republic of)
As of October 2009
- Systems <50 KWp: 0.46€/KWh
- Systems >50 KWp: 0.41€/KWh
As of July 2010
- Systems <50 KWp: 0.30 €/KWh
- Systems 51 to 1000 KWp: 0.26 €/KWh
Contract duration 20 years
Slovakia
As of December 2010- Systems <100 KWp: 0.43€/KWh
- Systems >100 KWp: 0.425€/KWh
Contract duration 15 years
10% decreasing in 2011.
South Korea
Situation as of Oct 11 2006.Feed-in Tariffs:
- Systems >30 kWp: KRW677.38/kWh
- Systems <30 kWp: KRW711.25/kWh (ca $0.75, €0.60)
Additional subsidies available.
Contract duration 15 years, constant remuneration
Spain
Situation as of 2009No change since September 2008: the legal framework is the Real Decreto (royal decree)1578/2008 replacing 436/2004 modified by Real Decreto 1634/2006.
Feed-in Tariff:
Building mounted
- <= 20 kWp: 0.34 EUR/kWh
- > 20 kWp: 0.32 EUR/kWh
Ground mounted
- 0.32 EUR/kWh
These feed in tariffs are capped at approximately 500MWp/y, of which 241MW ground mounted, 233MWp building mounted >20MWp, 26.7 MW <20MWp building mounted.
Taiwan
Situation as of 2009The Bureau of Energy under Taiwan's Ministry of Economic Affairs (MOEA) has announced the proposed feed-in tariff rates for photovoltaic (PV) and other types of renewable energy in September. A tentative rates of NT$8.1243-9.3279 (US$0.250-0.287) per kilowatt-hour (kwh) has been set for PV generated power, however, the proposed rates have fallen considerably short of local solar players' expectations. Public hearing will be held on 24 Sept to collect opinions from all parties concerned.
Turkey
Situation as of 2009Announcements in the press that Turkey will introduce a new feed in tariff for photovoltaic; €0.28/kWh for the first ten years and €0.22 for another ten years.
United Kingdom
Situation as of November 2010._ This mainly covers PV but other technologies can be found from DECC.gov.uk
UK Feed-in Tariffs The UK Government has introduced a feed-in tariff for small scale (up to 5MW) renewables from 1 April 2010, with a review in 2012 for changes on 1 April 2013. Though limits on max MWp installations will be announced in December to steer away from large solar utilities.
- From April 2010, the FIT will offer a fixed payment per kilowatt hour generated (see table) and a guaranteed minimum payment of 3p per kWh exported to the market (assumed 50% only)or you are entitled to opt out with your own Power Perchase Agreement (PPA). Tariffs will not be index-linked to the RPI.
- Projects up to 5MW will be eligible, including off-grid installations.
- Technologies that will be eligible for the FIT from April 2010 are: wind, solar PV, hydro, anaerobic digestion, biomass, biomass CHP and non-renewable microchip (see table for tariffs).
- The FIT will be offered for a 20 year period, with the exception of solar PV projects for which the period will be 25 years.
- The FIT designed with the aim of delivering 2% of the UK’s energy from small scale projects by 2020.
- Where appropriate, support will degress in line with expected technology cost reductions.
- Support levels will be reviewed periodically and in response to sudden changes in technology costs. However, tariff levels will be grandfathered, so that projects continue to receive the levels of support offered at their registration.
- Projects below 50kWp must be installed by MCS accredited installers. 50kWp to 5MWp projects will be subject to accreditation similar to the current RO process.
- Projects installed in the interim period between the announcement of the FIT (15 July 2009) and the start of the scheme (April 2010) will be eligible to receive the tariff with some conditions on the support period. However, any non-domestic projects that receive grant funding from central government will have to return the grant before they can receive FIT payments.
- Regardless of technology, projects installed prior to 15 July 2009 will be eligible to receive generation payments currently being auctioned of 9p/kWh and export payments of 5p/kWh, provided they were previously receiving support under the RO scheme.
- Projects up to 50kWp in size will no longer be able to claim the RO; existing installations will be automatically transferred to the FIT. New and interim period projects between 50 kW and 5MW will be given a one-off choice between claiming support under the FIT or the RO. Existing projects between 50 kW and 5MW in size will remain under the RO, with no opportunity to transfer to the FIT.
- No further capital/financial support for the up-front capital costs of projects. (though Green Deal for dwellings is under consultation as a no up front cost incentive for energy efficieny and renewables)
- Feed - in - tariff rates for PV grid connected
43.3 p/kWh < 4kW > 37.9 p/kWh < 10kW > 32.8 p/kWh < 100kW > 30.7 p/kWh
i.e. 43.3 pence/kWh fed in from a less than (or equals?) 4kW peak power installation
37.9 p/kWh for >(or=?) 4kW <(or=?) 10kW
32.8 p/kWh for >(or=?) 10kW <(or=?) 100kW
30.7 p/kWh for >(or=?) 100kW
Stand alone installation: 30.7 p/kWh
From 1 August 2011, the tariff rate for > 50 KWp will be 19.0 p/kwh.
Typical domestic (< 4kW peak?) installations registered (on or?) after Dec 12th 2011 will attract only (~)21 p/kWh.
Federal
Federal tax credits of 30%, which expires December 31, 2011, are available for residential systems and businesses. Details of this and state incentives are summarized at DSIRE.Legislation currently under consideration in Congress:
“Renewable Energy and Job Creation Act of 2008.” Full text at http://thomas.loc.gov/cgi-bin/bdquery/z?d110:HR06049:@@@L&summ2=m&. This multifaceted energy bill would extend investment tax credit. By June 2008, it had passed the House
United States House of Representatives
The United States House of Representatives is one of the two Houses of the United States Congress, the bicameral legislature which also includes the Senate.The composition and powers of the House are established in Article One of the Constitution...
but had not overcome opposition from Senate
United States Senate
The United States Senate is the upper house of the bicameral legislature of the United States, and together with the United States House of Representatives comprises the United States Congress. The composition and powers of the Senate are established in Article One of the U.S. Constitution. Each...
Republicans
Republican Party (United States)
The Republican Party is one of the two major contemporary political parties in the United States, along with the Democratic Party. Founded by anti-slavery expansion activists in 1854, it is often called the GOP . The party's platform generally reflects American conservatism in the U.S...
who had filibuster
Filibuster
A filibuster is a type of parliamentary procedure. Specifically, it is the right of an individual to extend debate, allowing a lone member to delay or entirely prevent a vote on a given proposal...
ed it over tax provisions that would finance the program http://www.greentechmedia.com/articles/senate-blocks-renewable-incentives-bill-992.html. In September 2008, it passed in the Senate with amendments.
California
Starting 1 Jan 2007 http://www.gosolarcalifornia.ca.gov/csi/performance_based.htmlAdministrative basis: California Public Utilities Commission (PUC) decision of Aug. 24, 2006
Feed-in Tariffs and Investment subsidies :
- Systems >100 kWp: $0.39/kWh
- Systems <100 kWp can choose either $2.50/Wp or $0.39/kWh
Contract duration 5 years, constant remuneration
Net metering
- Up to 2.5% of peak demand, rolls over month to month, granted to utility at end of 12 month billing cycle
Approved equipment
- Since 1 July 2009, the CEC list of approved solar panels has been tightened to the SP1 / NSHP list to provide more protection to the end-users. http://www.gosolarcalifornia.ca.gov/equipment/pv_modules.php
Colorado
Colorado became the first U.S. state to create a Renewable Portfolio StandardRenewable Portfolio Standard
A Renewable Portfolio Standard is a regulation that requires the increased production of energy from renewable energy sources, such as wind, solar, biomass, and geothermal...
(RPS) under Amendment 37 in November 2004. amended in March 2007
Investor-owned utilities
Public utility
A public utility is an organization that maintains the infrastructure for a public service . Public utilities are subject to forms of public control and regulation ranging from local community-based groups to state-wide government monopolies...
serving 40,000 or more customers to generate or purchase 10% of their retail electric sales from renewable-energy resources as well as a rebate program for customers
Utilities must provide increasing proportions of renewable or recycled energy
Energy recycling
Energy recycling is the energy recovery process of utilizing energy that would normally be wasted, usually by converting it into electricity or thermal energy. Undertaken at manufacturing facilities, power plants, and large institutions such as hospitals and universities, it significantly...
in their electricity sales in Colorado:
3% in 2007; 5% in 2008-2010; 10% in 2011-2014; 15% in 2015-2019; and 20% in 2020 and thereafter.
At least 4% of the standard must be generated by solar-electric technologies, half of which must be generated at the customer.
Cooperatives and municipal utilities must follow a lower scale culminating in 10% in 2020.
The 2007 amendments directed the Colorado Public Utility Commission (PUC) to revise or clarify its existing RPS rules on or before October 1, 2007. The PUC's rules generally apply to investor-owned utilities.
According to Green Power Network in 2006, U.S. tradable renewable energy credits (RECs) traded between ¢0.5 and 9.0/kWh. Many were at ¢2/kWh ($5–90/MWh)
Net metering
Net metering
Net metering is an electricity policy for consumers who own renewable energy facilities or V2G electric vehicles. "Net", in this context, is used in the sense of meaning "what remains after deductions" — in this case, the deduction of any energy outflows from metered energy inflows...
::
- Credited to customer's next bill; utility pays customer at end of calendar year for excess kWh credits at the average hourly incremental cost for that year, limit on system size 2 MW, no enrollment limit
Utility rebate programs
Many states have counties and utilities which offer rebates of from $500 to $4/watt installed, as well as feed-in tariffs of up to $1.50/kWh. See reference for list. 40 states have net metering. See reference.See also
- Solar Renewable Energy CertificatesSolar Renewable Energy CertificatesSolar Renewable Energy Certificates or Solar Renewable Energy Credits are a form of Renewable Energy Certificate or "Green tag". SRECs exist in states that have Renewable Portfolio Standard legislation with specific requirements for solar energy, usually referred to as a "solar carve-out"...
- Cost of electricity by sourceCost of electricity by sourceThe cost of electricity generated by different sources measures the cost of generating electricity including initial capital, return on investment, as well as the costs of continuous operation, fuel, and maintenance...
- Feed-in TariffFeed-in TariffA feed-in tariff is a policy mechanism designed to accelerate investment in renewable energy technologies. It achieves this by offering long-term contracts to renewable energy producers, typically based on the cost of generation of each technology...
- Green energy
- Renewable energyRenewable energyRenewable energy is energy which comes from natural resources such as sunlight, wind, rain, tides, and geothermal heat, which are renewable . About 16% of global final energy consumption comes from renewables, with 10% coming from traditional biomass, which is mainly used for heating, and 3.4% from...
- Renewable energy commercializationRenewable energy commercializationRenewable energy commercialization involves the deployment of three generations of renewable energy technologies dating back more than 100 years. First-generation technologies, which are already mature and economically competitive, include biomass, hydroelectricity, geothermal power and heat...
- :Category:Renewable energy by country