The contingent element of degression is related to trigger points of capacity deployed under the FITs
The level (or sometimes the timing) of degression can be varied depending on the capacity actually registered for tariffs in the given period.
Two degression approaches have been set; one for solar PV, and one for hydro, wind and AD. The timing and default degression percentages are shown here.
Tariffs for larger-scale wind and hydro are not subject to degression in the same way, but linked to pricing under the RO.
Contingent degression factors
The default degression levels can be adjusted, depending on the actual new capacity installed.
If actual installations are within the default ‘corridor’ the default degression (3.5% per quarter for PV, 5% per annum for others) will apply.
If deployment is below this, a lower degression level applies; and above the default corridor are 2/3 higher triggers where increased degression levels would be used, as shown below.
Degression factors based on deployment
| Technology | Low corridor | Default corridor | High 1 corridor | High 2 corridor | High 3 corridor |
|---|---|---|---|---|---|
| AD biogas | 2.5% p.a | 5% p.a | 10% p.a | 20% p.a | |
| Hydro | 2.5% p.a | 5% p.a | 10% p.a | 20% p.a | |
| Solar PV | 0% | 3.5% p.q | 7% p.q | 14% p.q | 28% p.q |
| Windtdth> | 2.5% p.a | 5% p.a | 10% p.a | 20% p.a |
Contingent ‘degression bands’
The deployment corridors are assessed in various system size bands:
Installed capacity ‘trigger levels’ which define the applicable degression corridor
| Technology and band | Low corridor | Default corridor | High 1 corridor | High 2 corridor | High 3 corridor |
|---|---|---|---|---|---|
| AD biogas | |||||
| <=500kW | 0-2.3MW | 2.3-4.5MW | 4.5-9MW | <9MW | |
| <500kW | 0-19.2MW | 19.2-38.4MW | 38.4-76.9MW | <76.9MW | |
| Hydro | |||||
| Total | 0-12.5MW | 12.5-25MW | 25-50.1MW | <50.1MW | |
| Solar PV | |||||
| <=10kW | 0-100MW | 100-200MW | 200-250MW | 250-300MW | <300MW |
| <10kW<=50kW | 0-50MW | 50-100MW | 100-150MW | 150-200MW | <200MW |
| <50kW | 0-50MW | 50-100MW | 100-150MW | 150-200MW | <200MW |
| Wind | |||||
| <=100kW | 0-3.3MW | 3.3-6.5MW | 65-13.1MW | <13.1MW | |
| <100kW | n/a | 0-36.7MW | 36.7-73.4MW | <73.4MW | |
For solar PV, the relevant deployment period is the 3-month period ending three months before the degression applies. For other technologies, it is the calendar year ending three months before the degression rate changes. (See applicable degression dates here).
The actual levels achieved in period which have already completed are shown here.
Emergency adjustments
In addition to all that the government can impose an emergiency degression at the half year for those technologies which are degressed annually.
It has tried to explain thecircumstances on when and how this would be done, if required.
Anyone remember the time we advised government to “keep it simple”?