Industry NewsPlanned changes in the support mechanism for solar energy under the Feed-in Tariff (FiT) have met with strong criticism from the solar energy industry as well as business leaders, including the CBI. The changes, which will cut the support level for most installations, come soon after the aid for the technology had already been reduced in August 2011. If accepted, the new lower rate will come in from April 2012 and be applied to all installations which are on-line after 12 December 2011. The proposals are already leading to some projects being scrapped and others being rushed to ensure they can access the current higher rate.
The Department of Energy and Climate Change (DECC) issued a consultation on the changes. It focuses on cutting the rates for all installations under 250kW capacity. The change earlier this year had impacted on larger installations. Together, the two changes have significantly reduced the aid available to solar-based green projects.
The Government had made the initial changes due to concerns that the project was becoming too costly. The interest among medium sized commercial schemes had been high. As the project is funded through suppliers and incremental increases in all consumer chargers, the Government felt the potential impact on end users would be too great. The latest changes have a similar driver. Climate Change and Energy Minister Greg Barker commented, "My priority is to put the solar industry on a firm footing so that it can remain a successful and prosperous part of the green economy, and so that it doesn't fall victim to boom and bust. The plummeting costs of solar mean we've got no option but to act so that we stay within budget and not threaten the whole viability of the FiTs scheme."
The consultation can be found by clicking on the link below and closes 23 December 2011.
CBI Director General, John Cridland was quick to condemn the proposals. He responded, "Moving the goal posts doesn't just destroy projects and jobs, it creates a mood of uncertainty that puts off investors and they wonder what's coming next. Some companies have invested heavily in solar photovoltaic systems and in the supply chains needed to install them. That commitment has been undermined by the feed-in tariff decision - and so industry trust and confidence in the government has evaporated. This bodes poorly for investment in future initiatives."