Update on latest position here.
- posted
12 years ago
Update on latest position here.
"Q177 Barry Gardiner: For my own part, I would ask you why poor people who cannot afford to put these things on the roof should be subsidising rich people to do it."
*which is not to say the Committees' Members are free from spin: Members who think FITs are barking tend not to serve. OTOH there are Zacc Goldsmith and Caroline Lucas who did much of the questioning
Seems to me that there is plenty of political spin from both sides but principally from the witnesses.
What I can't get my head round is the figures, particularly the lifetime cost of each week's delay in reducing the FIT for new entrants - £275 million.
If we assume that the reduction in FIT from 43.3p to 21p would lead to new entrants getting perhaps £27,500 less over 25 years. That would be an extra 10,000 schemes being commissioned every week which makes Harry's claim not so long ago that there were some 90,000 installations already commissioned seem a serious under estimate.
The other figure being bandied about is the lifetime cost of doing nothing - £37 billion. 37 billion/275 million or about 135 weeks at the rate of 10,000 new schemes a week. 1.35 million installations or about
16% of households. That is an awful lot of rich householders all piling in on the FIT bonanza. And a good deal more than 16% of the houses where such installations are feasible.All a bit pick and mix but surely the figures the Government are basing their case on are grossly inflated.
That £27,500 figure I used earlier is what you get if you start with £900 and assume inflation of 2.5% pa over 25 years.
Well one day a Government will know what and why its doing stuff. I think all prospective government folk should listen to Right said Fred, the comedy song. It seems nobody learns you never get nowhere if yer is too hasty. Brian
The facts still look to me like really people who know nothing about what they were doing did things without much advice. However, where do you go to learn how to do this sort of job?
Brian
I suggest the key question to focus on is the extent of "forestalling". It doesn't matter (much) what the rate of PV installations was *before* the announcement about cutting the FITs. The question is what the rate will be *after* the announcement but before the cut-off date. (This is a very common concept in taxation. Eg if the government announced on Monday that VAT on power tools was going up to 75% from 1 January 2012 the rate at which power tools was sold would, I predict with some confidence, be much greater between now and then than it was last month. Hence increases in excise duties tend to apply from 18:00 on Budget day.)
Seems right: the legisaltion provides for FITs to be increased in line with the RPI; the RPI tends for technical reasons to be 0.5 percentage points higher than the CPI; the CPI target is 2% pa.
I can assure you that they did know what they were doing.
But that doesn't mean the minister taking questions did.
There certainly seems to have been a bit of a rush to get on the bandwagon before the cut-off date but the implication of the Government figures was that unless the FITs were cut immediately as well as sharply everyone with a spare £15,000 they didn't have a need for for decades would join in and continue to sign up in droves month after month and year after year.. I would be very surprised if the number of installations commissioned between 31st October and 12th December is as high as 10,000. Perhaps a FOI request is in order to see what the panic really was about and another to see how many squeezed in before the door slammed shut.
I got a spam last week saying I could sign up before the deadline, sure I believe they'll get it installed in time ...
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