Solar firms entitled to pursue £132m claim against Government

The High Court has ruled that 14 British solar and construction companies can pursue up to £132m worth of compensation over the Government's illegal cuts to feed-in tariff subsidies for solar installations in 2011.

 The ruling follows a successful legal challenge in 2012 which found that DECC acted illegally; failing to adhere to consultation rules in giving the solar industry sufficient warning of the cuts to financial support for installations announced by Greg Barker in 2011.

Cutting feed-in tariffs is thought to have damaged investor confidence and cost 9,000 jobs in the solar and construction industries.

Mr Justice Coulson ruled that the claimants were entitled to ‘just satisfaction’ for the losses incurred but stopped short of specifying the scale of compensation. “Although the entitlement to damages will ultimately depend on the facts, as a matter of general principle, the claimants have demonstrated an entitlement to damages,” he said.

Reacting to yesterday’s ruling, TGC Renewables’ managing director Ben Cosh said: “The Government’s ill-thought-out cuts to solar subsidy cost jobs and was a huge setback to Britain’s growing solar industry.

“Britain needs to back its solar industry. Solar will soon be cheaper than all forms of wind power, and before long will beat gas on price. However, it can only do this if it’s competing on a level playing field. Retrospective cuts to solar support will put the brakes on solar’s journey to cost competitiveness. They’re bad news for bill payers, and today’s ruling shows the Government acted illegally.”

Commenting on the ruling, a DECC spokesperson said: “We are unhappy about this judgement and will be appealing against it.

“We believed we were proposing lawful changes to subsidies, which would protect consumers from rising bills at a time when windfall profits meant the industry was booming.

“Solar is a huge success in the UK, worth £2.2bn a year, thanks to government support, and the tariff changes that protected consumers from a £50-a-year bill rise by 2020 haven’t changed that success.”

Friends of the Earth, which was one of the organisations challenging the Government decision, reacted to the news with head of campaigns Andrew Pendleton claiming that the Government’s ‘cack-handed and unlawful attempt to cut support for solar power could cost it millions of pounds’.

“This money would have been better spent encouraging homes and businesses to develop their own clean energy and help wean Britain off dirty fossil fuels,” said Pendleton.

“Ministers should make the provision for a stable support framework for UK renewable power, including the feed-in tariff, a top priority – instead of constantly looking for ways to undermine its huge potential.”

The ruling follows new plans by DECC to end support for large-scale solar installations through the Renewables Obligation in May. Earlier this month, 150 businesses and solar industry leaders wrote to the Prime Minister; calling for support for solar power and warning that continued policy uncertainty is harming the industry.

Matt Field

Action inspires action. Stay ahead of the curve with sustainability and energy newsletters from edie