Government urged to follow FiT model

Leading building services figures have called on the Government to follow the example set by
Germany on feed-in tariffs (FiTs) to support renewable and microgeneration technologies.

German users of combined heat and power (CHP) and photovoltaics (PV) are set to receive generous fees for the electricity they generate in their homes and offices from January 1 next year.

CHP owners will receive between 11.59 and 13 euro cents for every kWh they generate. This consists of a quarterly agreed price from their utility company, an 'avoided network usage' payment for not taking power from the grid and an additional CHP bonus of 5.11 cents. They already receive a guaranteed premium price for any excess electricity they sell back.

The German parliament has just passed the CHP Act, which guarantees these generous feed-in and own usage tariffs until 2016, allowing users to invest in CHP engines with confidence. PV users will receive 49 cents because of the far higher cost of buying and installing PV systems.

'FiTs are already proving extremely successful in Germany and I would urge the UK to consider a similar system,' said Matt Johler, export manager of Baxi-SenerTec, the UK-owned CHP manufacturer based in Bavaria.

'In 1999 the German market was very similar to the UK market today, but the incentives have totally transformed the commercial environment in favour of microgeneration. Under the new regulations, microgenerators now have the same rights as the large utility companies and power stations.'

'CHP has the best payback of any of the sustainable technologies whatever the market conditions,' said Mike Malina, consultant to the M&E Sustainability campaign. 'The German model is an ideal one for the UK to follow because it shows what can be achieved by using financial incentives.

'If the UK government is serious about cutting carbon emissions and improving our security of energy supply, it must stand up to the utility companies and impose a FiT system that guarantees consumers a fair price for energy they generate themselves.'

Currently, UK microgenerators do not receive a guaranteed price for the electricity they sell back to the grid. In fact, in many instances they receive no payment at all.

'I'm highly envious of the German FiT for CHP,' said Phil Jones, chairman of the CIBSE CHP Group. 'Relatively speaking, we are  like a size zero in comparison to our continental friends and need feeding up - or in. I think that community-wide CHP is the way to go. It is more efficient and cost-effective than individual units, plus it gathers together heat loads to form a larger base load, which is good for CHP.'

Baxi-SenerTec UK business manager David Shaw added: 'A 25 per cent capital subsidy for CHP would lead to 18 million units being installed by 2030. This would reduce the country's CO2 emissions by 24 million tonnes a year.'

The House of Lords is debating amendments to the UK Energy Bill including the possible introduction of a minimum feed-in tariff of 5p/kWh. This proposal was voted down during the original debate in the Commons.