Parliamentary statement on new FITs levels welcomed by industry
Energy minister Chris Huhne has alleviated some strain on the solar PV sector but not addressed the 'elephant in the room', according to the industry.
In a written statement to parliament today (January 19) Mr Huhne explained a cut in Feed-In Tariffs (FITs) to a maximum of 21p/kWh was in response to a substantial increase in deployment of PV, prompted by falling prices, with levels at nearly double the original projections for the first two years of the scheme.
There were indications, made by climate change minister Greg Barker that the results of the consultation would be revealed this month, however those comments were made during a tense talk with angry members of the Micropower Council.
It is now clear that the responses and Department for Energy and Climate Change (DECC) views of them will now be revealed by February 9.
However, the plans are subject to judicial review the future of which is currently the subject of an appeal at London's High Court by DECC.
Mr Huhne said: "We are now waiting for a judgment and we cannot be sure of the date on which this will be issued.
"We continue to stand by our original proposal. However, I know that the uncertainty while we await the court's decision is difficult for the industry.
"A retention of the 43p tariff could also create substantial risks to the FITs budget if our appeal is unsuccessful.
"For these reasons, we believe it is prudent to bring forward our decision on one aspect of the consultation: the proposals for new solar PV tariffs."
Mr Huhne then laid before Parliament draft licence modifications which, subject to the Parliamentary process set out in the Energy Act 2008, makes provision for the reduced tariff rate, from April, for new PV installations with an eligibility date on or after March 3 this year.
Solarcentury who are one third of the group behind the legal action with HomeSun and Friends of the Earth cautiously welcomed the statement.
Head of public affairs, Seb Berry, said: "The Government is taking an important step today to restore some certainty to the PV market in the short-term, but it is no more than that.
"The elephant in the room for all FIT technologies, not just PV, remains the Government's decision to impose an unrealistic cap on the FIT scheme in 2010.
"Until that fundamental issue is addressed by the 'greenest Government ever' what we have today is no more than a temporary albeit welcome step forwards."
Friends of the Earth's Executive Director Andy Atkins said: "At last the Government is taking steps to sort out some of the uncertainty that's crippling a thriving UK industry - planned cuts will at last allow solar firms to start planning for the future.
"Solar payments should be cut in line with falling costs - but by trying to rush through payment before the consultation closed Ministers created a shambolic mess that threatens 30,000 jobs and the future of the industry.
"Minsters must urgently use the millions of pounds in tax that solar firms generate to safeguard this industry and the jobs and businesses it has created."
"We must do more to protect cash-strapped families from soaring fuel bills - that's why we're campaigning for the Government to fix our broken energy system and enable more people to plug into clean British energy."
BandCurrent generation tariff New generation tariff
4kW (new build) 37.8 21.0
4kW (retrofit) 43.3 21.0
4-10kW 37.8 16.8
10-50kW 32.9 15.2
50-100kW 19 12.9
100-150kW 19 12.9
150-250kW 15 12.9
250kW-5MW 8.5 8.5
stand alone 8.5 8.5