DECC called to pay £50m in solar damages claim

The Department of Energy and Climate Change (DECC) has been issued a damages claim from five solar installation and construction companies over the Government's illegal cuts to feed-in tariffs last year.

Total demand for compensation of losses incurred by the cuts has now reached approximately £50m, up from the initial demand of £2.2m made in July.

The five companies now calling for damages join Solar Power PV Ltd, Crystal Windows and Doors Ltd, and Solarlec PV Solutions Ltd who have had claims lodged at the High Court since the end of August following DECC’s earlier refusal to accept liability for their losses.

The organisations claim that the cuts to the feed-in tariff, which were ruled ‘unlawful and unfair’ by the High Court, Court of Appeal and Supreme Court in Spring 2012, directly caused damage to solar installation businesses.

More firms are expected to file proceedings through the legal team who issued the claim, Prospect Law, within the next few days.

Companies looking to join the damages claim have until 31st October 2012 to do so before the limitation period for making a claim against DECC closes.

CEO of E-tricity, one of the new claimant firms, Simon Gillett, said: “Sadly, the damage that the Government’s unlawful conduct caused the Solar PV industry was very serious indeed.

“The Ministerial Announcement at the end of October 2011 put a great deal of pressure on both the business and its employees, forcing us to make drastic cut-backs and cost reductions wherever possible.

“We are one of the lucky few that have been able to keep our business moving, but the reality is that the way in which DECC attempted to introduce these cuts to FITS rates caused our business and the industry significant damage and loss. By issuing a ‘Letter Before Claim’ today we are requesting that the Government acknowledges the losses it caused, and takes the appropriate action to compensate us”.

A spokesperson from Prospect Law added: “The 2008 Energy Act and the regulatory regime which introduced the Feed-in Tariff provided an effective set of rules for delivering the UK’s clean energy future. The way in which DECC administered this positive framework for solar PV created a “legitimate expectation” under which both the public and industry could operate.”

The spokesperson added: “By casting aside the rules under which the solar industry operated, the Government caused major financial losses and materially harmed the confidence of both consumers and the industry. Solar is a robust industry, and one the public wants, but significant damage has been done to the sector.”

Responding to the claim, a DECC spokesperson told edie: “While we can’t comment on the details of individual cases, the Department does not accept it has any liability and we will vigorously defend our position.”

Leigh Stringer

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