The small-scale Feed-in Tariff (FiT) scheme is set to cost the UK Government £700 million in 2014-15, some £200m more than originally predicted, according to a report.
Cornwall Energy – an independent consultancy – said the uptake of solar panels had driven up the cost of the scheme in recent years. But the consultancy firm said that the growth in the popularity of anaerobic digestion (AD) systems was also driving up costs.
A reduction in the demand for electricity has also pushed up the costs of the scheme, the report added.
A Cornwall Energy spokesman said: “Prior to the introduction of the FiTs scheme, there was less than 10MW of solar PV installed in the UK; there is now over 2GW in the FiTs scheme alone.
“In the first year of the scheme (2010-11) consumers paid just 4p/MWh towards FiTs; this rose to 50p/MWh in 2011-12 and has since increased rapidly to nearly £2.50/MWh in 2013-14.
“The annual cost of FiTs in 2014-15 is forecast to once again increase on the previous year.”
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