A UK Government review of the Feed in Tariff (FiT) scheme is considering reducing the amount of money paid to people who generate their own green energy.
The FiT supports renewable developments below 5MW. Electricity from this scale of development can be used to power machinery and property on a farm or small business. However, if the cuts go ahead, funding for solar will be reduced by 87% and wind by 58%.
The consultation on changes to the scheme ends tomorrow, 23 October.
Scottish Renewables, the National Farmers Union Scotland and Glasgow-based wind turbine manufacturer Gaia-Wind have condemned the cuts.
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Research by Scottish Renewables shows Scotland has 42,000 FiT-scale solar schemes, 2,557 small wind projects and 204 hydro-electric schemes along with three anaerobic digesters.
Gaia-Wind CEO, Johnnie Andringa, said: "For the vast majority of our turbine owners a sensible and supportive Feed-in Tariff is a crucial part of the economics of 'distributed energy' – the generation of power mostly for on-site use.
"Farm-scale wind – a sector with a substantial, if shrinking, base of British manufacturers – is becoming a core element of the rural economy as farmers seek to diversify from dwindling traditional income streams.
"The changes to the FiT, however, mean we could now see more company failures and job losses as a direct consequence of government policy."
Stephanie Clark, Policy Manager at Scottish Renewables, added: "Reductions in support for small-scale renewables provided through the Feed-in Tariff will hit rural businesses particularly hard, coming as they would on top of well-publicised low prices, particularly in the dairy industry."
Gemma Thomson, NFU Scotland's Legal and Technical Policy Manager, commented: "These proposals will end many on-farm renewable plans, and severely limit the number of new projects that will come forward in the future.
"NFU Scotland's President Allan Bowie has written to DECC to voice the Union's concerns directly.
"The knock-on effect for farm businesses will be that a previously viable way of dividing risk and reducing exposure to price volatility will no longer be an option."
(LM/MH)
