A project to install solar panels onto the roofs of approximately 22,000 social housing and council homes may be put on hold due to funding problems.
The project, which has been pioneered by Empower Communities, relies on the feed in tariff from the government. This allows people who generate their own electricity from a renewable energy installation to claim a payment for the electricity they generate, even if they use it.
The feed in tariff was first introduced in April 2010 and the government have since received a large number of applications for the help. It was designed to encourage more people to set up their own renewable energy source.
People looking to take advantage of the scheme are still able to claim a generous payment for the electricity they produce, but there has been recent speculation suggesting that the government will cut the tariff for this electricity by 75% from April next year.
The tariffs have previously been criticised for not helping poorer communities. The initial costs of installing solar panels can be high and as such, it is mainly wealthy households who are able to fund the installation. The funding for the tariffs is generated from the electricity bills which everyone else pays, and only those who can afford the set up costs can take advantage of this scheme.
Empower point out that their scheme would help to redress the balance between those who could afford to take advantage of the feed in tariff and those who couldn’t.
It is estimated that the solar panels that were planned to be installed by the Empower Communities project can save £120 from the electricity bills of many people in social housing.
Often, these are low income families and many of them already pay the highest price for electricity through pre-payment meters.
It is estimated that 1 million housing association and council properties could be suitable for a solar panel installation. If funding was adequate, this could be of benefit many vulnerable people in the UK.
A spokesperson from Empower Communities suggested that the feed in tariff was being ‘cut off at the knees.’ It is estimated that the cut to the tariff could cause a £175 million shortfall in funding for the project.
The project planned to install between 8 and 10 solar panels on the roofs of council homes across Wales, Yorkshire, East Anglia and Lincolnshire. These would be expected to generate between £100 and £250 of electricity for tenants to take advantage of. Any left over power would then be sold on the grid and the profits would be shared between the social landlord and the financial backers.
The Department of Energy and Climate Change have confirmed that the feed in tariff is under review, but also advised that it was unlikely to change before April 2012.
Any changes to the tariff could also impact on many thousands of other planned renewable energy installations by a variety of organisations.