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Community Hydropower Grants vs Loans

Hydropower Grants vs Loans

Hydropower Grants vs Loans

Important note – some grants cannot be combined with the Feed-in Tariff

This is really important if you want to ensure that the hydro turbine(s) receives the full benefit of the Feed-in-Tariff (FiT), which as this is the single-largest component of the hydro turbine income you almost certainly will.

Under the FiT rules, using publicly-funded hydropower grants towards the installation costs of the project will make the site ineligible for the FiT. Although this sounds bad there are exceptions and exemptions so provided you stick to the rules you may be OK.

In particular for hydro turbine projects you can use grant money for feasibility-stage and grid reinforcement works. This means that if you secure one of the feasibility grants outlined in the funding section you will be fine, though if you secure more substantial grants towards the main construction works you need to check the rules in detail to make sure you remain eligible for the FiT, or make sure the source of the grant is not publicly-funded money.

The rules regarding grants and eligibility for the FiT are covered in detail in section 2.48 onwards in the ‘Feed-in Tariff: Guidance for renewable installations (Version 6)’ available from the ofgem website (at the bottom of the page).

The table below indicates whether public hydropower grants can be used in conjuction with the Feed-in-Tariff.

Can public grant money be used in conjunction with FiT?
Yes No
Feasibility studies Site purchase
Planning permission Turbine supply & installation
Grid network reinforcement in the wider area Structural design
Reasonable design/civils costs if required to avoid or mitigate environmental harm Civil works
Grid connection
On-site electrical works

Examples of public grant providers:

  • Defra
  • DECC
  • BIS
  • Councils
  • Energy Saving Trust
  • National Lottery

Are you considering a hydropower project ?

Renewables First have considerable experience as a hydro consultant and have a full project capability, from initial feasibility study through to system design and installation.

The first step to develop any small or micro hydropower site is to conduct a full feasibility study.

Contact us about a feasibility study today!

Once complete, you will understand the site potential and be guided through the next steps to develop your project. You can read more about hydropower in our Hydro Learning Centre.

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