The Feed in Tariff (FiT) that subsidises green energy schemes costs you and me money every year on our electricity bill. We all pay for the few to benefit from renewable energy. As someone involved in helping to get renewable energy projects off the ground I hear this argument on a regular basis from people who are against it.
Yet the opposition-groups, media and even Government fail to mention what it actually costs everyone each year. According to figures issued by Ofgem in May this year the FiT cost to a household with an average annual electrical bill (£470 per year) is £1.
In 2011 the average electricity bill in Cornwall was £723 so the FiT levy, paid to renewable energy schemes that are less than five mega-watts, costs each household roughly £1.53 per year. How can Cornish communities turn the £1.53 cost into a positive? £1.2 billion is spent on energy each year in Cornwall, and nearly all of the money leaves the Cornish economy. With energy prices forecast to rise, this is a serious challenge for householders, businesses and the county.
In the past we had little choice but to take our pick of the big energy suppliers and pay the going rate for electricity supplied through the national grid. With the introduction of FiT, things are beginning to change. Homes and businesses can now be generators, as well as consumers, and take control of energy costs. Since FiT was introduced in 2010 more than 6,700 homes in Cornwall have installed solar PV panels on their roofs.
The FiT pays small and medium-scale generators a premium on top of what they get paid for the green electricity they generate, whether they use it themselves or export it to the local grid, making the investment worthwhile.
As the cost of renewable energy technologies comes down, so does the FiT for new installations. Subsidising renewables helps to reduce our dependence on imported fossil fuels and stabilise energy costs. When prices go up you get paid more for the electricity you generate, which helps compensate for the increase in cost of the electricity you buy.
Community energy co-operatives are being set up across Cornwall to help local people work collectively to take control of their local energy economy. Not everyone has a suitable roof for solar panels or the money to pay for them. A local energy co-operative enables collective ownership of both building-scale renewable energy generation and larger-scale generation, such as wind turbines, with the benefits shared across the community.
Low Carbon Ladock is one example of an energy co-operative working to reduce energy bills. To date, the co-operative has installed 12 sets of solar PV panels and five sets of solar thermal panels; two biomass boilers; two ground source heat pumps; insulated four buildings; and put up a 20kW wind turbine in a farmer's field. The host buildings benefit from reduced energy costs whilst the FiT income goes back into the co-operative.
These installations currently generate about £11,000 a year for the community to install further renewable generation technologies and improve community facilities.
Low Carbon Ladock is now aiming to install a 500-800kW community turbine that will increase what the co-op can re-invest in the parish each year to over £40,000 and generate around a third of the electricity used in the parish. Local people will be able to invest in the turbine, and the co-operative is working on ways for homes and businesses to be able to buy the green electricity generated under an arrangement that provides protection against future price rises.
Setting up and running a local energy co-operative requires investment and a lot of work from volunteers and commercial partners. To have a real impact on a community's energy economy, larger-scale generation such as wind turbines is required, as well as building smaller-scale generation and energy efficiency measures. These can be controversial.
The money Cornwall spends on energy each year is more than we earn from tourism. Turning this around requires collective action and local ownership of energy generation, and local energy co-operatives provide an answer.
However, if communities don't act quickly they will miss the boat. A land rush for commercial wind and solar PV developments is well underway and many of the suitable sites have already gone. The local electricity grid is running out of space to connect renewable energy generation and the planning system is straining under the weight of applications.
We can change the way energy is generated and owned, and take control of our energy economy. But by the time we wake up to that it may be too late.