Wednesday, 20 June 2012

The new solar war
By Robin Whitlock


Some people doubt the economic importance of renewables, particularly solar PV, but you only have to look at what’s starting to happen in the relations between China and America to realise that converting to solar PV makes very sound business sense indeed. 

Every government in the world now recognises the importance of solar PV to the emerging global energy market, writes Emma Hughes of Solar Power Portal. That is very true indeed and it has effectively resulted in a bit of a trade war between certain players in the global solar sector, particularly China and America. The reason for this is that each nation is now determined to maintain their market share and there have been accusations levied against China that they are seeking to dominate the market by artificially lowering the prices at which they sell solar PV equipment to the wider world, a practice known as ‘dumping’. 

America claims that China has been able to do this through state subsidies which make their products increasingly attractive to installers, and therefore also to the consumer. As the Chinese market grows accordingly, it is effectively contributing to the failure of many American and European manufacturing companies. This has been going on for some years, but now America has had enough and the US government has now introduced laws which levy tariffs on Chinese crystalline solar panel imports, termed ‘anti-dumping tariffs’, ranging from 31.14 percent to 249.96 percent. Chinese companies in turn are gathering together to discuss what can be done about this and so a political battle has started between the two countries over solar. 

“This proposal is tough, but it’s needed to successfully counter China’s unfair trade practices” said US Senator Charles Schumer recently. “This hard-hitting plan will level the playing field for US solar producers so that they can compete, create jobs and become a global leader in this rapidly-growing industry.”

However, Chinese Commerce Ministry spokesman, Shen Danyang, has hit back, saying: “The US ruling is unfair, and the Chinese side expresses its extreme dissatisfaction.” In effect, China is saying that the US ruling is unfair and that it will seek ways in which to fight it. But this is not the end of the squabble, in fact it could be just the beginning, because the same group of industry executives that lobbied the US government to introduce anti-dumping legislation is now intending to approach the EU in Brussels. We could therefore see similar anti-dumping tariffs introduced across Europe, particularly as the EU has already considered suing China with regards to dumping back in March this year. 

While consumers to an extent may favour a reduction in costs for solar PV it also means a reduction in Feed-in Tariffs in order to preserve state budgets for solar PV incentives, and that has also meant less accessibility to solar PV for lower income households, given the sharp reduction in companies prepared to offer free panel deals with Feed-in Tariffs taken as payment. More seriously, Chinese competition threatens domestic solar PV manufacturing. The introduction of anti-dumping tariffs could therefore raise costs and extend current payback periods which means that the government would have to look again at Feed-in Tariffs in order to maintain a reasonable rate of return on investment (ROI).  

So there are two aspects to this issue which need to be considered. The government needs to support manufacturing but at the same time it also needs to maintain growth in the sector. Anti-dumping tariffs make sense from the point of view that the renewable energy industry is a key part of measures to reduce our dependence on fossil fuels, particularly foreign oil, the industry therefore needs to be supported as much as possible. The Catch-22 however is that such tariffs will invariably mean higher prices for solar PV, which in turn will affect the numbers of installations with accompanying impacts on jobs in the sector. In effect, the outcome of this emerging political battle is far from clear but one thing is certain, it’s a dispute that will affect the industry for years to come.

Source:

Solar Power Portal

http://www.solarpowerportal.co.uk/news/feature_the_battle_for_the_solar_systems_5478



Thursday, 7 June 2012

DECC predicts stability in solar market over next 3-years
By Robin Whitlock


An announcement recently made by the Department of Energy and Climate Change (DECC) recently predicted that the UK solar market will remain stable for at least the next three years, despite the commotion caused by the recent range of government cuts and the forthcoming subsidy cut from 21p per kWh to 16p, due to take effect from August. 

Feed-in Tariffs (FiTS) were never intended to be an everlasting subsidy or to generate profits for speculators, however the new round of subsidy reductions has been introduced with particular modifications to the process which should bring a measure of stability back to the market and therefore we should also see a return in consumer confidence. There are two particular measures which are intended to encourage stability, which are:
  • A multi-installation tariff for organizations installing more than 25 systems consisting of 90% of the standard tariff (increased from 80%)
  • An increase in the export tariff, for installations with an eligibility date on or after August 1st, from 3.2p per kWh to 4.5p
The life of the tariff will also be reduced from 25 to 20 years for those systems with an eligibility date on or after August 1st and tariffs for installations that do not meet the energy efficiency requirement will be set at the same rate as stand-alone systems. DECC have also detailed the manner in which the tariff will be reduced over the next three years, a decrease of 3.5% every 3 months commencing on October 1st 2012. Over the course of a year the subsidy will therefore be reduced by around 2.24p, much better than the 27.3p reduction experienced by the industry since December 2011. 

“There have been a lot of gloomy headlines about solar power but the fact is the returns on offer are far better than anything you can get in the bank” said Carl Bennett, the Managing Director of Trade Skills 4U. “The smart money is on solar PV. And by investing in solar power not only do householders protect themselves from rocketing electricity bills; they help local businesses and employment. Our business has enjoyed growth as result of our investment in solar. Last year we built a first storey training roof, which is the only one of its kind in the UK, in order to train solar installers and in the environment they will be working in when they qualify. Our dedication to ‘real life’ scenario training as seen a steady rise in business and helped to drive us forward in the recession when many have cut back. Now that government have announced future stability for the Feed-in-Tariff, we can only predict a steady and stable future for solar which is of course great news for everyone.”

Martin Gebbett, Director of DPS Renewable Technologies, had this to say: “The announcement by the DECC signals an end to the uncertainty that has prevailed in the PV solar industry since September 2011. We believe the new set guidelines allow us to plan move clearly for the future and drive our business forward. We have seen a noticeable increase in enquiries over the last few weeks and see a positive outlook.”

Environmental groups such as Greenpeace have long been urging people to invest in solar. The reason why they are so much in favour is because solar is a truly sustainable technology which can play a real part in helping to reduce climate change. However solar can also offer attractive rates of returns to investors and so is of interest to consumers as well. 

Since the introduction of the Feed-in Tariff in April 2010 there have been over a quarter of a million installations across the country with the solar industry employing at least 25,000 people with the potential for further growth, even in the face of one of the worst recessions the country has experienced since the end of the Second World War. Both the government and the industry expect to see 22 GW of solar installed by 2020 benefitting both the economy and the environment. 

Source:

Ecofriend




Wednesday, 25 April 2012

Solar Installation Downturn - Latest News
By Robin Whitlock

It appears from recent figures released by DECC that installation rates for solar PV have effectively crashed since the last cuts to incentives on 1st April. In essence there has been a sharp decline in installation, falling to 2 MW each week reported by solar firms since the start of April in comparison to 4.8 MW per week during the same period last year. Industry executives blame the decline on cuts to tariffs for small scale solar with Jeremy Leggett of Solar Century stating that the ‘heat had gone out of the market’. Leggett blames the government saying “They've done a great job in stuffing the embryonic industry.”

Feed-in Tariffs – The Story Continues
By Robin Whitlock

Some may think, now that the legal shenanigans over Feed-in Tariffs that have been filling the news over the earlier part of this year are now over, that everything is hunky dory and the government won’t be making any more cuts to FiTS for a while. If this is you, you couldn’t be more wrong.

The government, quite legitimately, is concerned about preserving the budget set aside for tariffs while simultaneously attempting to preserve a reasonable rate of return for investors. To this end it published guidelines in February, in the form of its 2A Consultation document, which sets out how tariffs will be administered from 1st July and the government’s objectives for the near future.

The proposed regulations will affect all those solar PV systems with an eligibility date of 1st July or after, setting out tariff rates and also a planned degression rate of around 10% every six months which will be implemented as a means of financial control. From October 2012 there will be further cuts every six months and there is a proposed mechanism by which this date could be brought forward, allowing two months notice, if the uptake of solar PV is in excess of 125% of what the government predicts it will be. Furthermore there is a consultation on whether to reduce the period over which subsidies for solar PV will be paid from 25 years to 20.

Consequently, the consultation document contains three alternative tariff tables. The choice of which table the government will eventually apply is dependent on the uptake of solar PV in March and April. The degression rate has been pitched at a level of 10% but the government is also considering whether it would be more realistic to aim for a lower degression rate of around 5%. Originally the government was trying to aim for a rates of return of 5% but various respondents to the consultation thus far have suggested this may be too low and so the government seems willing to aim instead for returns of between 4.5% and 8%, with a level of 6% being applied to domestic systems and 8% for commercial. The government’s thinking on this is motivated in part by an uncertainty about the likely future costs of PV.

Essentially therefore there are three ‘starting scenarios’, which are as follows:

  • Based on a rate of return of 5-8%, a tariff of 13.6p for installations below 4 kW producing an annual return on investment (ROI) of between 0.5% and 10%, depending on which scenario concerning future costs of solar PV predicted by Parsons Brinkerhoff (PB) turn out to be correct. If such costs fall within the high end of PB’s predictions, then it is more likely that an ROI of 0.5% will apply, and conversely if costs gravitate towards the low end, then an ROI of around 10% will be applicable.
  • A reduction of tariffs by 25% from April levels, by 1st July, producing ROI’s of 5-8% under PB’s central cost prediction for most bands with an ROI of over 8% for the two largest bands, and a tariff of 15.7p for systems of 4 kW or less.
  • A cut of 21% from April producing a tariff of 16.5p for installations of 4 kW or less and a mid-range ROI of 6.1%. Essentially the first option would apply if uptake of PV in March to April reached 200 MW, the second option would apply if that figure was lower at between 150 to 200 MW and the third option for an uptake of less than 150 MW. Tariffs for multiple installations, where the person receiving the tariff operates more than 25 installations, will be set at a lower rate to reflect economies of scale. Furthermore, the tariff for those installations not abiding by the energy efficiency requirements would be set at a ‘Stand Alone Rate’ of 8.9p per kW as of 1st April 2012.

The planned degression of 10% every six months would be automatic but there would be an annual review. The degression rate would be brought forward if PV installation exceeded predicted levels. Overall the government intends to ensure that FiTS for solar PV remains affordable through the Levies Control Framework (a system devised by the government last year to maintain spending on energy and climate change initiatives within agreed limits). It is this framework which maintains the central trajectory for spending on FiTS and against which spending is measured.

Tuesday, 17 April 2012

Reduction in Feed-in Tariffs Drives Free Solar Panel Installers Away
By Robin Whitlock


A recent study by Free Solar Panels UK has revealed that at least half the UK’s free solar panel installers have left the solar market as a result of cuts to Feed-in Tariffs (FiTS). The study claims that there are now as few as 8 installers in the whole country ready to assist those who cannot afford up-front payments for solar PV.


Free panel installers have had to endure a further cut, beyond that which affected everyone else in the market, because of the government’s sudden refusal to support them. Only 2 of the 3 leading free panel installers remain in the solar business – A Shade Greener and Isis Solar. Many others continue to provide panels, but only with an upfront payment.


"The Government was fully supportive of the Free Solar Industry way back in October 2009” said Stewart Davies, the CEO of A Shade Greener, “ but now seems intent on making it very difficult for companies such as ours to continue to provide this invaluable free service, without which the FIT Scheme is entirely elitist.” Nevertheless, Mr Davies said that his company remains committed to the free solar principle and will continue to supply free panels to the public for the foreseeable future, as well as an entirely free energy assessment. The energy assessment will provide householders with an EPC certificate which is valid for ten years. 


The exit of so many installers from the market have effectively left the UK with a number of ‘solar PV blackspots’ with regards to free panel provision, according to the study.


Source:

PR.com

Free Solar Panels UK


Thursday, 1 March 2012

Scientists Develop New Highly Efficient Solar Cells
By Robin Whitlock

New solar cells that could increase the efficiency of solar panels by over 25 percent have been developed by scientists at Cambridge University’s Department of Physics.

Solar panels work by capturing particles of light from the sun, called photons, and then converting to units of energy, called electrons. Thus far, solar panels have only been able to capture a part of the sun’s light, leaving the remainder to escape as heat. The Cambridge scientific team, which is led by Professor Neil Greenham and Professor Sir Richard Friend, has helped to change that by developing a hybrid cell which absorbs red light. It harnesses the extra energy of blue light which then boosts the electrical current. By adding pentacene, which is an organic semiconductor, means that solar cells can generate two electrons for every photon in the blue light spectrum. This enables solar cells to capture 44 percent of the sun’s energy instead of the 34% previously obtainable. It is the pentacene which captures the blue light but it has to be combined with other material. “If our cells just relied on pentacene, they would only absorb blue light,” Professor Greenham says. “The trick is to combine the pentacene with a second material in the same cell that also absorbs the red light. That way we can use the red light and the blue light efficiently within the same cell.”

Greenham chose pentacene because it works very quickly using a process called ‘singlet fission’. The resulting level of energy absorption is still low but there are all the signs that it could improve quickly. “Everyone is working to improve cells to take them closer to the physical limit.” Greenham says “Our new strategy raises the limit that we can chase. If we can use our strategy to improve cells that are already working efficiently then that should make a real impact. Our strategy works within a single cell, and the materials— organic molecules and inorganic semiconductor nanocrystals—are compatible with printing processes, so they have the potential to be both cheap and efficient.”

Bruno Ehrler is the lead author on the new paper and a scientist at Cambridge University’s Cavendish Laboratory. “Organic and hybrid solar cells have an advantage over current silicon-based technology” he said, “because they can be produced in large quantities at low cost by roll-to-roll printing. However, much of the cost of a solar power plant is in the land, labour, and installation hardware. As a result, even if organic solar panels are less expensive, we need to improve their efficiency to make them competitive.” Dr. Akshay Rao, co-author on the paper said: “This is just the first step towards a new generation of solar cells and we are very excited to be a part of this effort.”

Sources:

Solar Power Portal

Eureka

Solarnovus



Monday, 13 February 2012

Government Proposals: ‘Armageddon’ For Solar Industry?
By Robin Whitlock

The government is planning to speed up the reduction in Feed-in Tariffs, and that means potential meltdown for the industry, the renewable energy company EcoEnvironments has claimed.

The company has warned that the tariff rate could plummet to 13.6 pence per kWh from July this year. “A reduction to a tariff as low as 13.6p in just a few months’ time is the equivalent of armageddon for the solar industry” said EcoEnvironments director David Hunt. “There is simply no way that product and installation costs will drop that much in such a short period of time to make such a low tariff rate economically viable. Together with a dramatic slashing of Fit rates in July, ministers are also proposing ongoing six-month reviews, a reduction from 25 to 20 years for the Fit rates being applicable for solar PV and the removal of RPI-linked payments.”

According to Mr Hunt, these proposals directly contravene Energy and Climate Change Minister Greg Barker’s ambition to install 22 GW of solar energy by 2020. “Yet again the government, even with a newly appointed energy secretary in Ed Davey, seem happy to watch the solar industry lurch from one crisis to the next” he said. “It is crucial that Ministers listen properly to the industry this time and ensure that the consultation process on future tariffs is a robust process rather than last time’s sham. Rather than looking to encourage consumers to embrace renewable energy technologies, you would think the Government was trying to turn people away from them.”

Hunt added that ‘the devil was in the detail’ which could mean lower prices, removal of the RPI-linked payments and reduction from 25 years to 20 years for tariffs that apply to solar PV.

Jeremy Leggett of Solar Century commented that "the new Liberal Democrat Secretary of State had an opportunity today to reassure 30,000 solar workers - but he's blown it.”. Leggett said that further cuts to tariff levels from July with the prospect of even more cuts every two months from then on would mean the PV industry facing ‘ongoing turmoil’. “It's really time for Ed Davey to do something that Chris Huhne stubbornly refused to do” Leggett added,  “Sit down with the industry, work with us, and demonstrate your commitment to saving tens of thousands of UK solar jobs. If he's serious about green growth and green jobs, that's the least that he can do.”

Barker nevertheless has informed the House of Commons that he intends to treat the solar PV sector with ‘TLC’ which he claimed stood for ‘transparency, longevity and certainty’.  However Daniel Green of HomeSun said that solar PV “will now become the exclusive plaything of the wealthy who live in the south of England.”

Sources:

FT Adviser

Click Green



Wednesday, 8 February 2012

UK Feed in Tariffs... the truth will out!
by Martyn Judd

We wrote a couple of weeks back that the UK Court of Appeal had rejected the Government's bid to repeal the legal ruling that changes to the feed in tariffs were 'legally flawed'. We had all hoped that this would reinstate the 43p rate, but reality is often stranger than fiction!

In the event, the Government simply ignored the Courts and vowed to take the matter to the Supreme Court without leave to do so. This meant that the case was unlikely to be heard for at least 8-months and, in the meantime, the feed in tariff is 21p and NOT 43p, although many unscrupulous installers are saying that it is. In response, REAL (the renewable energy insurance organisation in the UK) issued a stark warning to members that they must not tell consumers that they will get the higher rate. Even British Gas issued a letter stating the same.

Two things may happen from here:
  1. the feed in tariff consultation paper, published tomorrow (9th January), may say that the 21p rate is what is required and, as a result, the DECC will undoubtedly follow the Supreme Court route;

  2. the consultation paper will question the 21p rate cut and the DECC will have to decide where to go from here.
If DECC takes the case all the way to the Supreme Court, then all installations will be subject to the lower feed in tariff and only if the Supreme Court upholds the illegality in 8 / 9 months from now, will the higher rate be back-dated for installations made up until 3rd March. If the DECC abandons the fight, however, then chances are the higher rate will apply immediately to all installations between 12th December 2011 and 3rd March 2012.

Until we know more, we strongly recommend that consumers report installers promoting the 43p tariff to the STA or REAL:



Solar Panel Shortage As Stock Diverted to Germany
By Robin Whitlock


Solar PV installers throughout the UK could face a shortage of solar panels due to manufacturers diverting their stock to Germany, the Renewable Energy Association has warned.

The situation is partly a result of the scramble to meet increased demand in response to the December 12th deadline last year, in which many installers used up their existing stock reserves. However, with the possibility of a return to the higher Feed-in Tariff rate of 43p in response to the government defeat in the Court of Appeal, the UK market is showing signs of reviving with a sudden rush of orders following the announcement of the verdict on January 25th. Unfortunately increased demand for panels in Germany and the US has meant that an unexpectedly large amount of solar PV equipment has gone to installers elsewhere, rather than the UK. In December Germany suddenly increased its solar PV capacity by 3 GW, having introduced 4.5 GW of new solar power throughout the rest of the year. A similar influx of panels into the United States has taken place in response to the forthcoming introduction of US Government duties, according to a US solar manufacturing association. The Coalition for American Solar Manufacturing (CASM) represents over 150 US companies and has reported an annual surge in Chinese imports of around 346 percent. The combined extra delivery of panels to the US and Germany means that there is now very little left to satisfy demand from other countries around the world, including the UK.

“For the UK the present 'mini gold rush', as a result of the Government losing their Appeal, has come at the wrong time” explained Ray Noble, solar PV specialist at the Renewable Energy Association. “not only because of the USA/Chinese product demand, but the fact that Germany installed 3GW in December - after having only installed 4.5GW in the previous 11 months. The Solar Industry was expecting a slow start in 2012 and thought they had enough stock to meet demand and took a long break over Xmas, however they had not allowed for the unexpected 3GW going in Germany which cleaned out the Warehouses of the top brand solar companies.” Mr Noble went on to state that many of the major producers, including the Chinese, will only be able to replenish their stocks by early March, after the 3rd March tariff change deadline.


Sources:

Click Green

Solar Power Portal

Friday, 27 January 2012

Victory For Now – Government Appeal Rejected

By Robin Whitlock

The government appeal against the High Court decision concerning the December 12th deadline for Feed-in Tariff’s cuts has been soundly defeated in the Court of Appeal. Three judges presided over the hearing and their decision was unanimous. Unfortunately however, this isn’t quite the end of the story, since Chris Huhne has decided to take the case to the Supreme Court. The judges refused the government permission to do so, so that means Mr Huhne will have to take the case to the Supreme Court directly. Mr Huhne’s decision to launch a further appeal has again thrown the sector into disarray causing more confusion among installers, clients and investors. 

So far the whole episode has cost the taxpayer £66,000 in legal fees, a figure that has prompted Ed Milliband to call for the government to accept the decision and move on. Huhne, however, is adamant, blaming the whole episode on the ‘mess’ left behind by Labour. North Tyneside MP Mary Glindon joined Mr Milliband in his appeal to the government to stop wasting public money "How much more public money do you intend to waste fighting the court ruling?" she asked the Energy Secretary, to which he replied "Spending a few thousand pounds in order to save consumers £1.5 billion, which is what would have happened if we had left this case to run - the reality is that Labour introduced a scheme which was fundamentally flawed." Meanwhile the Renewable Energy Association has called the whole affair ‘a fiasco’ and demanded an end to it so that the sector can ‘get back to business’.

John Cridland of the Confederation of British Industry (CBI) has also joined in the fray commenting "The judgment should be used to draw a line under this saga, which saw the Government scoring a spectacular own goal and confidence in the renewables sector undermined." Friends of the Earth, HomeSun and SolarCentury, who launched the challenge against the government in the first place, have accused Mr Huhne of ‘making a mockery’ of the consultation process.

Mr Huhne has written a ministerial statement explaining his decision to seek a further appeal.

Sources:

The Press Association

The Independent

Greenwise Business

Wednesday, 25 January 2012

Feed in tariff goes back to 43.3p

We will post more in the next day or so, but in short, the Court of Appeal rejected the DECC's case and, unless anything unexpected happens, all installations until 3rd March will qualify for the higher 43.3p feed in tariff. Those after the March deadline will get the 21p rate after April. This is a big difference to the return on a solar investment; about £4000 for a 4kW solar installation!

Tuesday, 24 January 2012

Court of Appeal to rule on FiTS Cut on 25th January

On Wednesday 25th, the UK Court of Appeal is due to decide whether or not the Government (DECC) has grounds for appeal against the December ruling that the rushed cuts to the feed-in-tariff, or not.

If the Court rules in favour of an appeal, then the reduced tariffs introduced on 12th December will stand and it is expected that the industry, lead by Solar Century and Friends of the Earth, will drop their legal challenge. However, should the court rule that the Government does not have sufficient grounds for appeal, then the FiTS will revert back to their pre-cut rates (up 41.3p / kW). Fearing that they would lose the right to appeal, the DECC has already introduced a contingency date of 3rd March, which would see all installations after this date subject to the lower tariffs.

The industry, however, remains split about whether or not a temporary reintroduction of the higher tariffs will be good for business. In the short term, we can expect a mad rush to install as many systems as possible at the higher rate of return, although this may also lead to the chaos and 'questionable' ethics of last November. Either way, we all have to accept and manage the new lower tariff rates from March, regardless of tomorrow's outcome.

Friday, 20 January 2012

UK Government Sets New Date For Tariffs Cut

... just in case it loses the appeal....

By Robin Whitlock

The government is aiming for a new deadline of 3rd March for a Feed-in Tariffs (FiTS) cut just in case it loses the appeal currently being considered by the Court of Appeal. The Department for Energy and Climate Change (DECC) has delivered a proposal for draft licence modifications before Parliament. Subject to the Energy Act 2008, the document makes provisions for “a reduced tariff rate (from 1st April 2012 onwards) for new solar PV installations with an eligibility date on or after 3rd March 2012”.

Energy and Climate Change Minister, Greg Barker commented in a ministerial statement “I know this is a difficult time for the sector and I want to do as much as I can to end the current uncertainty created by the legal challenge. We must reduce the level of FiTS for solar panels as quickly as possible, to protect consumer bills and to avoid bust in the whole Feed-in Tariff budget. We’re appealing against the court ruling that’s challenged our proposal for a December reference date. This remains our aim, and we are waiting for the judgement of the Court of Appeal. But this is too important for us to sit and do nothing while we wait. Today we’re putting in place a contingency that will bring a 21p rate into effect from April for installations from 3 March. However, we are still pressing ahead with our appeal and if successful, we retain the option of introducing a December reference date. In the circumstances we believe this gives the industry as much certainty as is possible. And it puts us in a better position to protect the budget for everyone involved.” 

The statement also reiterated the government’s intention, should it win the appeal, to stick to its original proposals including the December 12th deadline. Meanwhile Friends of the Earth welcomed the government’s plans to reduce the amount of uncertainty which it describes as crippling a thriving industry.
           
           
Sources:

Renewable Energy Focus

Business Green

This is Money

Tariff’s stalemate costs UK solar industry £25k a day

By Robin Whitlock

The latest on the legal debacle over Feed-in Tariffs: while the country is waiting with baited breath to see if the government is granted leave to appeal, it has since emerged that the current stalemate is costing the UK solar industry rather a lot of money. According to analysis, the current stalemate is costing the industry some £25,000 per day, largely in cancelled and deferred orders, exacerbated by increasing sales costs, uncertain wage bills and depreciation of redundant stock. The situation has been made worse by lack of consumer confidence and considerable confusion.

In an article for GreenWeek, David Hunt of Eco Environments described the industry as being in ‘total limbo’ and criticised the government for their handling of the whole affair. “The Government has not covered itself in glory during this whole sorry saga” he said “and today’s outcome further exacerbates the negative impact of their actions. The industry needs to move forward without the prospect of months of continued uncertainty hanging over it. While the reduction in the feed-in-tariff to 21p/kWh for domestic customers is greater than we would have wanted, the industry now accepts that we have to work with the new rate which still offers a fantastic return on investment for homeowners.”

He went on to state that the major issue is the possible outcome of the appeal. “If the Government wins its appeal, the industry is spared the return to a 43p domestic FIT rate which will blow an already overspent budget, causing a short boom, and a catastrophic bust for the renewable energy industry, not just solar. The FIT budget is not separated by technology, if it is all spent on solar PV, then Wind, Hydro and other eligible technologies will lose the FIT subsidy too. However, it would cause long term uncertainty for the industry, having created a precedent that Government can make retrospective changes to FIT and other subsidies, giving major concerns to any potential investor, domestic or commercial, now and in the future. If on the other hand the Government loses the appeal, then we will end up with the boom and bust, wiping out the FIT budget at a stroke. This will result in a nightmare for all renewable installers with short term ‘cowboy’ selling and long term job losses and company closures.

Hunt believes that the present state of limbo is likely to continue given that either side could elect to go to the Supreme Court if they lose. “The only certainty is seems will be ongoing uncertainty which is already costing jobs and creating a crisis of confidence among potential investors. This will not help to secure the futures of many companies which simply will not survive another few months’ of paralysis.”

Meanwhile an even more serious issue threatens to follow hot on the heels of the FiTS debate. In April Ministers plan to insist that only homes rated Grade C with regard to energy efficiency will be eligible for full FiTS subsidies. At present 90% of homes in the UK do not meet this requirement and industry experts predict that upgrading to the required standard will cost somewhere between £5,300 and £12,000. Such a figure is likely to beyond the capability of most ordinary people. Hunt believes that it is absolutely imperative that the government abandon this policy.

“That is if we still have any feed-in-tariff left after the High Court judgement!” he said.

Source:

Click Green