The rate of feed in tariff for each technology is reviewed every 3 months and if more than a certain designated megawattage is installed then that triggers a drop in the tariff.
This has just happened for hydropower, wind and AD. PV remains untouched this round. See http://www.british-hydro.org/news/decc_confirm_10_degression_for.html and follow the link.
For a hydro scheme you can pre accredit with Ofgem to fix you tariff rate at the current level if you have the required Environment Agency EA licenses but have not yet installed. Hydro schemes take years to develop due to the complexity of EA license requirements and a long time to install because of the bespoke nature of each project (no off-the-shelf-solutions as with solar and wind. So there is a large proportion of pre=accredited but unbuilt hydro schemes that have triggered this degression. Worse still, we are expecting another 10% degression in July 2015. When you add to this the recent rise from £135 to £1500 for EA licensing you can see that hydro is fast becoming unviable.
We develop these renewable projects because we know they are needed to mitigate climate change and we are environmentalists. But this government has constantly changed the goal posts and keeps the industry destabilised and performing well below its potential. Ed Davey has done the best he can at DECC and was until recently ably supported by Greg Barker (who fellow Conservatives accused of “going native” within DECC ie agreeing with Ed Davey’s line). But he has been partially undermined by George Osborne who has fossil fuel leanings and probably doesn’t want to see those interests undermined by a renewable industry that is too successful.
I would say from recent RE generation stats, you can see that with stable support and let off the leash, RE could kill off the fossil fuel industry quite quickly.
