Legal wrangling over support for the solar industry is likely to reach a head, as the Court of Appeal will decide on Friday(13 January) whether to hold a full hearing into the government’s handling of the recent support cuts.
“The High Court’s decision was based on the view that the proposed approach to implementing new tariffs for solar PV is inconsistent with the FiT scheme’s statutory purpose of encouraging small-scale, low-carbon electricity generation. We disagree with this for a number of reasons,” a DECC spokesman said.
“The overriding aim of the proposed reduction in tariffs for solar PV is to ensure that over the long term as many people as possible are encouraged to install small-scale, low-carbon generation (including other technologies as well as solar PV) and benefit from the funding available under the FiT scheme. Without an urgent reduction in the current tariffs, which give a very generous return, the budget for the scheme would be severely depleted and there would be very little available for future solar PV generators, or for other technologies.”
But Ben Cosh, director at TGC Renewables, said that while a gradual reduction of subsidies was needed for the long-term viability of the solar sector, the key requirement was certainty and decisiveness from the government.
“While the inevitable government cut to the solar Feed-in Tariff should not – despite a court ruling and the vocal few – spell the beginning of the end for established players operating in the UK solar industry, it does sound a note of caution. Simply put, while the tariff cuts should drive greater efficiencies in the production and installation areas of the market, further action is required in order to foster and promote genuine long-term industry growth.”
The Renewable Energy Association has written to secretary of state Chris Huhne seeking assurance that the legal battle will not jeopardise the long-term future of the FiT scheme. It suggests pulling the scheme into general taxation could provide a solution.
DECC intends to make an announcement about the future of the FiTs scheme, including final proposals on PV and consultation proposals on non-PV tariffs, after the conclusion of the appeals process.