Solar subsidy

NATIONAL: LOW INCOME HOMES NOT GETTING FAIR SHARE OF SOLAR SUBSIDY

Low-income households are not getting a fair share of the solar panel subsidy and look set to lose out even more under current government proposals, new research shows.

Research by environmental consultancy, Camco, commissioned by the National Housing Federation, estimates that social housing tenants in England have not yet received their fair share of the solar photovoltaic (PV) feed-in tariff (FIT) subsidy even though they have to pay a surcharge on their energy bills for it.

The research reveals that English social housing has received about 10% of the domestic PV allocation against the 16% which would be its fair share, based on its proportion of UK housing stock.

In 2009, the last date for which data is available, 762,000 social households were estimated to be living in fuel poverty (21% of social homes), a higher proportion than in any other tenure. That number is believed to have risen sharply as a result of increased energy prices, and will continue to do so if social landlords cannot counter it through energy efficiency improvements subsidised by mechanisms like FIT and the ECO fund.

David Orr, chief executive of the Federation, said: "Unless the Government introduces a community tariff of about 30p, double what it currently proposes, there is little prospect in future that social tenants will be able to secure the potential £150 annual reduction in fuel bills such schemes offer. Yet the Government proposes slashing the FIT by more than half from 43.3p to 16.8p per kilowatt-hour (kWh) for social housing schemes."

Camco's research indicates that in order for tenants to receive the free electricity that may help them out of fuel poverty, the tariff would need to be at least 32.4p/kWh - even then the returns for housing associations would be unlikely to cover the full costs of debt financing.

Mr Orr continued: "We need action now to deliver on Ministers' commitments to tackle the increase in fuel poverty which is resulting from spiralling energy bills. They need to look again at their proposals on solar PV to ensure a good future pipeline of schemes by social landlords which will deliver benefits to those on low incomes.

"Our research spells out clearly the economic fact that without doubling the tariff they propose for social landlord schemes, it is most unlikely there is any future for solar PV in social housing. The effects will be devastating for low income and vulnerable neighbourhoods as, due to the up-front costs of installation, social landlords were the only organisations likely to deliver these savings to these communities."