The Department of Energy and Climate Change (DECC) has now confirmed that the feed in tariff (FIT) is compliant with European law on State Aid Rules.
However it is still unclear as to what communities can claim to help them install renewable energy projects. Although the European Commission has said that grant recipients should not be eligible to receive the FIT, the latest DECC advice is that in some cases both grants and FITS can be claimed without breaching State Aid rules.
According to DECC, if a public organisation who has received a grant before 1st April 2010 for a renewable energy installation commissioned between 15th July 2009 and 31st March 2010, it could be eligible for FIT payments in the following scenarios:
1) Recipients of publicly funded grants who comply with the EU’s rules on ‘de minimis‘ aid. To be de minimis, public funding, including funding from FITs, must not exceed €200,000 (around £160,000) over a period of three years.
2) Non-standardised costs are additional costs incurred as a result of measures taken to reduce the environmental impact of a renewable energy installation. (This also potentially applies to residential claims).
It is however unlikely that communities contemplating bigger projects will be able to secure both significant grant investment and FITS. DECC is currently preparing a detailed guidance note to provide further clarity.
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