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14th November 2011

Friends of the Earth threatens Legal Action over Plans to Cut Solar Subsidies

Environment charity Friends of the Earth has warned that it may start legal action against the Government unless plans to cut solar panel subsidies are reversed.

Friends of the Earth has written to climate change minister, Greg Barker, to say that unless the Government amends its proposals to reduce the Feed-In Tariff’s (FITs) payments made to buildings generating electricity through solar panels it will start court proceedings.

The campaigning charity plans to seek a judicial review relating to the fact the consultation ends after the December 12 cut off for new solar installations to get the long-term full FITs level. In the letter, the Government are being called on to maintain the current tariff payments for existing projects until April 2012 and to extend the consultation period until February 2012.

Friends of the Earth believes the Government’s action is unlawful because it had previously said payments would remain unchanged until April 2012. Policy and campaigns director Craig Bennett said: “The government is breaking the law with its plans to fast-track a solar kill-off – as well as jeopardising thousands of jobs and countless clean energy projects across the country.

“Significant time and money has been invested planning solar schemes for homes, schools and libraries – giving them just six weeks to install is completely unacceptable, and schemes have already been scrapped.

“Ministers must amend their proposals and extend the deadline for solar tariff payments, or face judicial review”

The Peabody solar scheme in doubt:

The Peabody Housing Association had developed a solar scheme as a key part of its strategy to help residents reduce fuel costs and stay out of fuel poverty. It now looks like it will have to cut the number of installations by about 50%.

Stephen Howelett, chief executive of Peabody, spoke of the wider implications: “If we cut short our scheme, contractor jobs will be lost and Peabody jobs will be lost. We had planned to place young apprentices within our scheme. These too will be lost.”

He added that investor confidence may be the “greatest cost” and that: “We are very concerned that investors will be reluctant to get behind green initiatives.”

FITs – a victim of its own success?

The FITs have been successful in encouraging green technology electricity generation. The increase in take up of relevant solar photovoltaic systems qualifying for FIT payments has however seemingly exceeded the Government’s expectations resulting in the latest cut.

A spokeswoman for the Department of Energy and Climate Change (DECC) confirmed the Government has received the letter from Friend’s of the Earth threatening legal action, but gave no indication that a u-turn was being considered.

“We’re consulting on proposed new tariffs for a reason – to protect consumers from footing the bill for excessive subsidies. This is a live consultation and it will be open for people to comment until 23 December”

Minister and officials have consistently argued that urgent cuts to the level of incentives are required because the FITs budget is likely to exceed its cap – a scenario that would result in increased energy bills.

The DECC confirmed that it received two letter threatening legal action, declining to say who the second letter was from.

Hewitsons’ CleanTech Group monitors developments in this sector and advises installers, manufacturers, suppliers as well as clients on related technologies. For more information contact Colin Jones on either colinjones@hewitsons.com or 01223461155.

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