Rather unwittingly the last spendthrift Labour government thew the middle classes a nice little bone in their bid to be all green and cuddly. This was something called the Feed In Tarrif (FIT) which basically meant that if you generated your own electricity from a solar photovoltaic array on your roof you would get paid to do so and at a very generous rate of 43p per kWh as well. That's guaranteed for 25 years and index linked.
Oh and as there's no way to actually measure how much you generate gets back into the grid, you get 3p per 0.5kWh on top of that.
And you get to use all the electricity you generate too, so a household bill like mine of around £800 a year would come down to around £200 a year.
So with a 4kW array costing around £14k to install it works out that over the 25 years you'll make around 10 to 12% return and break even around the 8 year mark. And with my current investments making 2 or 3% at best its an absolute no-brainer. So last month some men crawled over my roof and I now have my own little power station that's generated over 100kWh of nice clean energy and enriched me to the best part of fifty quid in the couple of weeks its been running.
What's that Mr Government? Middle class people with disposable income making a profit? Oh no, that will never do, never never never! You're there Mr Middleclass to pay your taxes that we will spend on services you'll never use and give your money away to those poor developing nations with space programmes and nuclear weapons like India and China. We can't have you doing that, you're supposed to be installing solar because you can afford it and to make us in government look all green and answer the problem of Warble Gloaming! You're not actually supposed to treat this as an investment!
So in six weeks time the coalition are going to cut the FIT to 22p, and that's only if you've got a "C" energy rated house already (which is nigh on impossible to get if your house is more than 20 years old) . I did a quick back on an Excel spreadsheet calculation and the ROI on a 4kW rig like mine drops to around 2% and the payoff period almost triples to 21 years.
Now a small but significant industry has grown up in this country over the last 2 years to service the demand for Solar PV; it's estimated that it employs around 25,000 people. This is not to mention the ancillary services it supports like the team of scaffolders who shoved a load of metal poles round my house (and then took 2 weeks to come and take them down again!) - I was chatting to Mr Scaffolder and he said solar PV was around half their work these days.
Well Mr Scaffold is probably going to have to lay off some of his staff and there's going to be 25000 people heading for the dole office come December because nobody is going to want Solar PV now. A new industry, supporting thousands of people has been strangled at birth because oh my god we can't have people making money out of Eco-Wibble can we. Those people on the social are going to cost way fecking more than the feed in tarrif money ever would.
Sure, the high rate was to kick start the solar business in the UK and it was unsustainable at 43p but why the hell didn't you cut it back slowly and on the dates you promised? All the hoons in Whitehall have done by cutting the FIT in half is to strangle one of the very private enterprises that was supposed to hoover up all these public sector jobs at birth.
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