March 24, 2010
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If the government offered to pay you £1,000 a year for the next 25 years, in return for an up-front investment of £12,500, you'd snap it up in a second. Well, that's pretty much the deal on offer this week after the government finally revealed what it will pay those who install electricity generating solar panels – in and around their homes – through the new “Feed-in Tariffs” (FITs).
After years of campaigning by environmental groups – helped in small part by this newspaper – the government has finally agreed to reward households and businesses installing electricity-generating measures with enough of a return to make it a serious financial, as well as an environmental, investment. If you've got the money (which is a big “if”) and, crucially, a sunny, south-facing roof, you can earn a 7%-10% tax-free return, an income that will rise in line with inflation. At the same time, you get to do more than your fair share in reducing the UK's carbon emissions.
In the week that the energy regulator, Ofgem, warned the nation to expect 20% electricity price hikes by 2020, and warned future supplies were in jeopardy, investors in solar panels will have the added benefit of being a net provider of electricity, and largely insulated from future price hikes that could see household bills top £2,000 a year by 2020.
Announcing the new tariffs' introduction this week, the energy and climate change secretary Ed Miliband said the guaranteed income would be a big incentive for householders “to make the move to low carbon living”.
“The feed-in tariff will change the way householders and communities think about their future energy needs, making the payback for investment far shorter than in the past.”
Although Milliband announced a number of tariffs – including what the government will pay those installing wind turbines – the one that will appeal most to the average UK householder will be for installing photovolatiac (PV) solar panels – at a typical cost of £10,000-£12,500.
From 1 April, households with approved schemes will be paid for the electricity they generate, even if they use all of it themselves.
The level of payment depends on the technology and whether it is being fitted to an existing home, or installed as part of newbuild. Importantly, future payments are guaranteed for the next 25 years and have been, unexpectedly, linked to inflation.
Anyone fitting a typical £12,500, 2.5kW PV system to their existing home will initially be paid 41.3p per kilowatt hour (kWh) generated. Enough, according to Miliband, to reward them with up to £900 in the first year on top of a £140-a-year saving on their bills.
The measure, which is inevitably quite complicated, is designed to reward those who reduce their own electricity consumption by installing low-energy lighting and A-rated white goods, and to ultimately export excess electricity generated back to the grid.
Households get an extra 3p for each kWh they export on top of the 41.3p they get paid for all units generated. Those building PV roof panels into a new-build home get a slightly lower tariff (36.1p per kWh). The fact that the payments are not taxed make it a particularly rewarding investment for higher-rate taxpayers – those earning more than just over £43,000.
Regulated payments
The feed-in rates change depending on which year you install the technology. They will also apply to installations commissioned since July 2009 when the policy was announced. Early adopters, who have installed grant-assisted PV and registered for the ROC scheme, will also receive payments, but at just 9p/kWh.
The payments will physically come from your existing electricity supplier, but will be overseen by the regulator Ofgem. Jeremy Leggett, chairman of SolarCentury, the biggest supplier of PV systems to UK homes, says homeowners need a largish (8m2), unshaded, south-facing roof, or similar place to mount panels.
“Feed-in tariffs are going to be a big boost for the industry and for the first-time, homeowners can see a decent financial return,” he says. “We estimate homeowners can save and earn more than £1,000 per year for 25 years, increasing with inflation, giving a payback in around 10 years.”
He says homeowners with flat roofs may well find they can install a system, as will those with conventional roofs that face a few degrees either side of south, east or west. Panels perform best in unshaded sites angled towards the sun at a pitch of 30-40 degrees.
Prior to this week's announcement, grants of up to £2,500 had been available to those installing PV panels under the terms of the government's Low Carbon Buildings Programme. There are still grants available for other green technologies. FITs now provide the entire financial incentive for PV installers.
Dave Timms, climate and energy campaigner at Friends of the Earth, says the new tariffs will allow people to turn their homes into mini-power stations. “We were hoping the government would go further, but this is very welcome and long overdue,” he says.
“For householders who have a south-facing roof, PV panels are really worth looking at. Not only are they a sound financial investment, they will also allow you to do your part in tackling climate change.
“Our homes are responsible for over a fifth of UK emissions, but by fitting renewable electricity systems and wind turbines, we can be part of a greener, safer future.”
There is an expectation, he says, that once investors and banks see the benefits of the scheme, specialist loans or top-up mortgages will become available for those who want to install a system, but can't raise the capital.
Take it from me – it's worth it
This week's announcement on solar panels is good news for homeowners wanting to install green energy systems, simplifying the procedures and shortening the payback time of renewable technologies, writes Ashley Seager.
Ashley Seager went solar three years ago
I fitted solar photovoltaic panels on my house nearly three years ago. They are great – we get 90% of our electricity off our own roof over the course of the year. And three years ago the panels were more expensive than they are now.
We spent £17,000 but got half of that back in a grant from the Low Carbon Buildings Programme, which was dogged by complexity and stop-go decisions by the government.
It is much easier now. You install the solar panels or wind turbine and away you go – no messing about with grant applications that take months.
The pain for people like me who have already fitted such technologies is that we will only get a tariff of 9p per kWh, roughly equivalent to the payments we already get from the government's renewable obligation certificate scheme.
The Department of Energy and Climate Change (DECC) argues that it is incentivising new installations, not helping people who have already done one and may have got a grant for it. But that means early adopters – many of whom stuck their hand in their pocket for a lot of money and became evangelists for the new technologies – get a lower return than they would get if they had waited. Pity.
But, undeterred, I am looking at fitting solar thermal panels elsewhere on the roof to generate most of our hot water. That is because, as well as announcing the cashback for green electricity schemes, DECC also published its proposals for payments for renewable heat gear such as solar thermal or ground source heat pumps.
I reckon that from next April a normal solar thermal system could generate around £200 a year, based on the 18p per kWh DECC is proposing. Added to the £150-odd you save in heating water, you approach a 10% return, assuming you pay £3,000-£3,500 for your thermal system. Go for it!
Your questions answered
I have a PV system and am furious I'm not getting the new tariff. Can I rip it down and start again? Technically, it has to be “new”, and everyone in the industry has speculated as to whether this is possible. Unclear at best.
These figures look great on paper, but are they guaranteed? How much electricity your system generates, and the resulting returns will depend on the size and quality of panel and its position. Shading has to be avoided – even a telegraph wire. But sun-hours in the UK are remarkably stable and well documented – so you should get close to the promised figures.
What happens if I move house? The most obvious drawback, but it needn't put you off. Estate agents will get used to selling their benefits, and a PV scheme should add to the value. Lots of people spend £12,000 on a kitchen and don't expect to get the money back. If your buyer won't pay up, find another or take the system with you.
Are there any planning problems? In England and Scotland, you don't need planning permission for most home solar electricity systems, as long as they're below a certain size – but you should check with your local planning officer if the building is listed, or is in a conservation area. In Wales and Northern Ireland, you still need permission.
Is it just solar PV? No the government has announced tariffs for those fitting wind turbines – good out in the countryside – and also hydro schemes. Perhaps more importantly, it has said it will be giving feed-in tariffs to households installing solar water heaters, from April 2011. These are much cheaper (£3,500). There's also help for air and ground-source heat pumps. Money will be returning to this subject in forthcoming articles.
Have they got to be on the roof? Do they require maintenance? No. People have installed panels in gardens and on south-facing walls – although given their cost, you will want to find a secure spot where they can't be easily stolen. There are no moving parts and they require no maintenance – PV systems are designed to last 20-30 years. Miles Brignall
Comments
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I hate the photo you used for this article. Drenching things in pink is not the way to reach or appeal to the real woman geeks who are operating in the real business world. Just sayin'
Erin
Posted by: Erin |
February 20, 2010 11:16 AM -
Really superb article, except for the title and the image.
Posted by: Victor |
February 20, 2010 1:57 PM -
If it is sexism, call it sexism. Don't overlook it, don't call it something else. Definitely don't call it meritocracy. If you at a tech event, or a meeting, and some guy makes a sexist comment, then call him out. If you are a quiet bystander, you are an active participant. Tech entrepreneurship is a cutting edge thing, and there can not be room for sexism on the cutting edge. Sexism is not a problem for women to deal with. It is as much a problem for men. Our startups don't realize their full potential if we keep putting up with sexism.
Posted by: Paramendra |
February 20, 2010 8:40 PM -
If it is sexism, call it sexism. Don't overlook it, don't call it something else. Definitely don't call it meritocracy. If you at a tech event, or a meeting, and some guy makes a sexist comment, then call him out. If you are a quiet bystander, you are an active participant. Tech entrepreneurship is a cutting edge thing, and there can not be room for sexism on the cutting edge. Sexism is not a problem for women to deal with. It is as much a problem for men. Our startups don't realize their full potential if we keep putting up with sexism.
Posted by: Paramendra |
February 20, 2010 8:41 PM -
Hi Paramendra.
I didn't call it sexism because I don't think that's what this is about. And I bet most women don't believe for a second that there's been an intentional attempt to exclude women from computer science or the Internet.
I think the current imbalance is quite simply the result of numbers (
I also don't think there is an adversarial attitude in the women's groups that are springing up. It's not an “us against them” thing. That would be distasteful and counterproductive. I see this trend as simply an attempt to create an environment that encourages women to go into tech and the Internet by providing them a non-threatening support system, mentors and role models, and access to the establishment through these women's organizations.
Thanks for your comment!
Posted by: Pamela Poole |
February 21, 2010 12:12 AM -
Sexism, continued…
Part of my response was cut off:
I think the current imbalance is quite simply the result of numbers (less than 25% of developers are women) and gender role pressure/conditioning that causes fewer women to go into tech, as well as a narrow definition of Internet startups that focuses on new technology to the exclusion of new usages.
Posted by: Pamela Poole |
February 21, 2010 12:16 AM -
Sorry Pamela, I can't agree with this — suggesting older men or those wearing suits are incapable of innovation is just as misguided as the idea women shouldn't worry their pretty little heads with ideas of creating a start ups and should stay in the kitchen.
What's really holding back innovation and new thinking are tired stereotypes; putting up straw men and demonizing large parts of our society doesn't help.
The great opportunity presented by the rise of the net and the changing world economy is that a good idea from anyone, be they a 90 year old grandmother, a 50 year old office worker or a 30 year old single mom can become a world beating business.
That's what we should be celebrating instead of creating false divides.
Posted by: Paul Wallbank |
February 21, 2010 12:19 PM -
OMG. Give it up already. The pill and choice laws gave women independence from men, who indeed had behaved badly much of the time. But, once the formula for sex = babies was broken, women acted freely. They senselessly bowed to corporate and public sector needs and flooded the labor force with cheaper labor. it's been a race downhill ever since.
1950s - 1970s = Female labor pool explodes. (Try to find even one male grade school teacher today)
1980s - 1990s = Foreign labor pool explodes. (Offshoring and work visas were big corporate tactics)
2000s = Undocumented labor pool explodes. (Why do you think we needed all those no-doc mortgage loans)
Bottom Line: Corporate America needs fresh blood to keep up growth. That's why we're stalled. No new blood. Ladies, you've been had. Your standard of living is worse than the 1950s.
Posted by: Angie Aerobics |
February 21, 2010 6:56 PM -
Any argument for startups without technical founders fails before it's even out of the gate. A startup is about formalizing a (necessarily) vague idea into a working system. You might as well talk about a startup without any products!
Programmers are more than happy to work for equity.. That is the _bulk_ of the equity, as they're the ones doing the actual work!
Posted by: mind |
February 21, 2010 8:44 PM -
LOL.
That's the only comment your article deserves.
Posted by: Meganiuma |
February 21, 2010 10:38 PM -
The Internet and the startup culture have been dominated and shaped by the vision and appetites of young men and old boys from the start. This is just the way it is, and there's no need to get militant about it. But I have noticed a sharp rise in women-in-tech groups and activities lately, undoubtedly a response to this inequity.
Posted by: m3 karte |
February 21, 2010 11:46 PM -
Interesting post, Pamela.
On the one hand, I'm incredibly supportive of the goal: more female entrepreneurs. The imbalance in numbers concerns me, and when I see obvious sexism (e.g., booth babes, or the assumption that a woman is on the “soft” side of the industry) it frequently enrages me.
On the other, I'm suspicious of some of your assumptions here. If we're talking about the traditional internet startup, it requires intense commitment on the part of founders, a relentlessness in the face of barriers and setbacks. If taking a weekend off for Startup Weekend is a problem for anybody, male or female, should we even be encouraging them to pursue a startup? There are plenty of fine part-time businesses to start, but I don't believe an investor-funded, developer-needing internet startup is one of them.
Also, maybe this is just my impatience with an ocean of arrogant fresh-minted MBAs with bright ideas and nothing else (mostly male, in my experience), but it seems reasonable to be suspicious of people with no background in tech or startups and an idea that they think is awesome, especially when nobody with a clue shares their enthusiasm. Equally, it's reasonable to be suspicious of people who want you to work for free, because it's a sign they haven't persuaded anybody who knows them well to put in money, and haven't figured out how to make much on their own.
Hoping that people will “see the big picture” (that is, your picture) is wishful thinking. What defines developers is their interest in technology, and what defines investors is their interest in more money. Those are values, not conclusions to be reexamined. Certainly, mentoring women in putting their ideas in those terms is an excellent thing to do; founders need to be able to sell all sorts of people on the vision. But I think you need to take it further than that.
If you want new businesses based on different values than are common now, you need to find and connect the fraction of investors and developers who share those values — regardless of gender. I'm one of those developers, and I know a lot more of them. Give me a sales job on how your technologically boring startup is technologically awesome, and I'll assume you're an idiot, because you've stereotyped me by gender and title in a way that's offensive, and demonstrated ignorance of my field to boot. Sell me on the concept, on the other hand, and I'm in. Which is what you want in your early engineers anyhow: if they don't love the purpose and the domain, they are unlikely to make a stellar product no matter how cool the tech is.
Don't be blinded by the statistics on what people are like generally. Startups never work in general: they work very specifically. Specific founders. Specific investors. Specific employees. And very focused attention to the specifics of early customers. Coca Cola has to think in terms of what X% of men or women are like. But for startups, it's all about individuals.
Posted by: William Pietri |
February 22, 2010 9:53 AM -
I think it's quite possible that women start entirely different internet businesses. I'm sure that technical skills and lack of white-hot self-belief probably limit the numbers of women opting for start-ups that require venture capital, but I do see lots of lower-key internet businesses being set up by women.
That said, I would love to see more women in this area, because my sense is that they might develop quite different types of application, rather than the millions of me-too apps that we see currently.
Posted by: Alison |
February 22, 2010 1:48 PM -
Hi Janice.
I agree and tried to make it clear that I was talking about any people with non-technical backgrounds. I've been to lots of forums where people are looking for developers to bring their ideas to life, and most of the people searching for devs that I've seen are men.
Posted by: Pamela Poole |
February 23, 2010 5:01 AM -
Hi Paul.
I'm not demonizing any segment of society, just saying that when systems have been in place for a while with the same leadership, they tend to get less flexible.
As for your comment:
“The great opportunity presented by the rise of the net and the changing world economy is that a good idea from anyone, be they a 90 year old grandmother, a 50 year old office worker or a 30 year old single mom can become a world beating business.”
…that's one of the points I make (if you made it to the second page)!
Posted by: Pamela Poole |
February 23, 2010 5:07 AM -
Hi mind.
I don't agree entirely. Non-technical founders can't do it alone, it's true. That cop didn't study biomechanics, or medicine, or engineering… He came up with his prototype, but had to find a technical partner (probably someone who did study those things) to make it happen.
I am simply arguing in favor of opening the collective mind to ideas for Internet startups that come from non-technical people. I think there's plenty of room for everybody to play in that sandbox.
Posted by: Pamela Poole |
February 23, 2010 5:32 AM -
Hi William.
Thank you for your thoughtful comment.
There are other tests in life of intense commitment and relentlessness in the face of barriers and setbacks. You always hear of the working single mom or dad who's raising four kids and going to law school or med school at night in her or his 40s. Such people don't need to be tested, they need to be accommodated. People of any age who are driven will do what they have to to achieve their dreams, even if it means living two full-time lives. It's true that it's rare to have that kind of drive. But I would like to see more flexibility in the support system.
Your description of the idea people is pretty brutal! Sure, if their ideas suck, then somebody with a clue should tell them (and tell them why). But they should have some help getting the idea in front of somebody who is qualified to make that judgment. I think non-technical people might not know where to go with their ideas. It would be nice if there were a way for paper projects to get under somebody's nose at a very early stage like in the old days. Kind of the way publishers look at manuscripts, for example.
I'm sure you've tried to explain things about the Internet to people you know and received blank stares or changes of subject in return. I have. I can't even talk to about half of my friends about the things I do and am passionate about, seriously! So there could be (and will be) someone from a milieu that doesn't include educated people, or Internet-oriented people, or rich people - say a young man from a barrio or a 50-year-old career secretary, either of whom could be Web power users with good ideas - who deserves to be heard and not judged because he or she couldn't find or make a lot of money.
By “big picture” I actually meant the big picture of whatever vision the non-technical founder is trying to convey and get developers and investors excited about, and that they should in turn try to see how that vision could be technologically or financially interesting.
I think finding and connecting people who are open-minded is absolutely where it needs to start. And your advice about what to look for in early engineers is excellent. I'll repeat it for any who might read these comments: “Sell me on the concept, on the other hand, and I'm in. Which is what you want in your early engineers anyhow: if they don't love the purpose and the domain, they are unlikely to make a stellar product no matter how cool the tech is.”
Your last paragraph is also great advice for startups: “Don't be blinded by the statistics on what people are like generally. Startups never work in general: they work very specifically. Specific founders. Specific investors. Specific employees. And very focused attention to the specifics of early customers. Coca Cola has to think in terms of what X% of men or women are like. But for startups, it's all about individuals.”
If you missed Bernard Lunn's great series (nearly 2 years ago!) on the next generation of the Internet, I recommend it highly, especially Part 2. I'm sure you'll appreciate it: http://www.readwriteweb.com/archives/post_recession_phase_transition.php
Thanks again for taking the time to comment.
Posted by: Pamela Poole |
February 23, 2010 7:41 AM -
Interesting article.
I think the bottom line is that there are very few women in engineering thus they tend to be less connected to (engineer biased) startup breeding communities.
However some thoughts. It is a common prejudice to think engineers can be more easily motivated by tech than by an idea that may change the world. Nope. It's not the tech or lack thereof that may make them reserved towards an idea. Much more I think it's the differences in professional culture with those who are speaking those ideas out. If you go in a full business suit and approach them like a manager you may be lost even before you speak.
Be casual
You are essentially asking people to enter a very risky business. Being formal on matters that require enthusiasm and motivation does not help. Besides the best ideas do come in casual environments. If possible, have a beer with them
relate on a buddy level.Make your idea also theirs
Have a couple of brainstorming rounds with them. Engage them. Ask them to make their contributions to your idea. They would then relate to it and would be much more inclined to join you.I really wish though the time comes when more women join engineering.
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