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Government solar tariff payment cuts “illegal”

Plans by the Government to cut solar feed-in tariff payments are illegal the High Court has ruled, following a legal challenge.

Environmental campaign group Friends of the Earth, which brought the challenge alongside two solar firms, says it will be pressing the Government to come up with new proposals permitting solar payments to fall in line with reduced installation costs.

In November, the Government announced it was bringing forward the date for its reduction in feed-in tariffs to December 12, 2011, rather than in April 2012 as previously planned and 11 days before the consultation ended on December 23. Friends of the Earth argued this change with little notice was unlawful.

Under the proposals PV units installed post December 12, 2011 receive reduced FIT payments. For new residential units up to the 4kW band the rate was reduced from 43.3p per kWh to 21.0p per kWh.  The proposals lead to some EIS and VCTs withdrawing offerings or considering changes to product mandates.

Friends of the Earth is also calling for more Government money to encourage installations, the removal of planning restrictions and support for community-owned schemes.

Andy Atkins, executive director of Friends of the Earth, says: “These botched and illegal plans have cast a huge shadow over the solar industry, jeopardising thousands of jobs.

“We hope this ruling will prevent ministers rushing through damaging changes to clean energy subsidies – giving solar firms a much-needed confidence boost.”

He adds: “Solar payments should fall in line with falling installation costs but the speed of the Government’s proposals threatened to devastate the entire industry.”

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Comments

There are 5 comments at the moment, we would love to hear your opinion too.

  1. Question is – which of the providers (and Solar Firms being included) created a ‘product’ which basically only worked due to the tax incentive?

    Will firms not learn – you should never create a product which only works because of a tax incentive!!!

    The underlying product needs to actually work too (and from what I have read – most didn’t, they purely worked as they got ‘free’ money from the government)!!

    Do the Solar panels actually generate a sufficent level of Electricty, to repay the cost of construction, installing and returning electricty to the national grid?

    I doubt it!

  2. Paul Howards comments are obviously not from an informed position.

    Solar technology clearly works, and the efficiency of such installations has been proven across the globe for over 30 years now.

    The German market continues to strive and has now been in operation for some 10 years. The returns that are actually being received by consumers to date is far outweighing that forecast via the Goverment standard assesment tool.

    Companies that have purely jumped on the Solar bandwagon due to the incentive payments maywell suffer as this is not a “get rich quick scheme” for installers, However renewable energy companies that have a structured approach that installs and offers a range of renewable energy technologies has a very bright future as the Government has very stringent Co2 cuts to meet.

  3. Anonymous | 22 Dec 2011 3:31 pm

    If the technology ‘clearly worked’, why was it only when the government in effect offered huge incentives did companies start selling it ‘on mass’?

    I am guessing. historically, there was never enough ‘meat on the bone’ (i.e. the returns might just about pay for the cost of the panels – but thats about it) to make large scale residential solar panels work.

  4. A 4kWp system installed in the uk will generate 4000 units of electricity which will return in savings £ 520 and the average cost of a 4 kWp is approx £10000 so it would pay for itself in 15 years with the increase in fuel costs. The FIT just makes it a better investment so that people are willing to spend the money. I would rather pay for the feed in tariff so that people are in work than pay taxes for those that aren’t!

  5. What has it got to do with a judge whether or not the Govt gives a tax incentive or takes one away?

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