The proposed cuts are part of Phase 1 changes (which will affect small-scale solar PV with a total installed capacity of 250kW or less), with Phase 2 coming later in 2012. The cuts may also be complemented by new domestic energy-efficiency requirements, which must also be met from 1st April 2012 or else the PV installation may receive an even lower tariff of 9p/kwh.
The UK Government consultation may demand that either a property’s efficiency is brought up to an EPC rating of C or above, or it must have all potential measures on its EPC for Green Deal finance carried out, with no additional finance required. This could mean that 86% of homes would need to be better insulated before they could qualify for the FIT, and could increase initial costs by between £5,600 and £14,000, and that’s without the cost of the PV panels even taken into account. It has been suggested that this may stop 9 out of 10 installations from going ahead.