The Government’s challenge to last month’s High Court solar ruling will be heard by the Court of Appeal today.
In Dec 2011, Friends of the Earth and two solar companies - Solar Century and HomeSun - won their legal battle against subsidy cuts that a previous agency consultation have branded “legally flawed”.
FOE believes the decision to remove the Feed-in tariff (FIT) before the end of the consultation was unlawful. Today, we shall see if the Court of Appeal agrees.
The U.K. government wishes to reduce feed-in tariff subsidies (FITs) - household payments to those that generate green electricity through solar panels - on any installations completed after December 12, 2011.
The original consultation was issued on 31 October, closing late December, and proposed reducing electricity payments from 43.3p per kWh to a mere 21p for households across the country.
The Government wants force in tariff reductions because it believes the current subsidies are too generous and it is ‘unaffordable’ in the current economic climate. Furthering this argument, the Energy secretary suggested it would “severely deplete resources for future solar PV generators, or for other technologies”.
FoE executive director Andy Atkins believes the Government’s proposed cuts and ‘power’ suggested retrospective through the appeal, has “cast a huge shadow over the solar industry, jeopardizing thousands of jobs”.
The High court previously ruled that it would be unlawful for the Energy Secretary to carry out the reductions by referring back to the December deadline last year, which falls in the middle of the aforementioned consultation period.
If the government wins the appeal, this could mean retrospectively it holds the power to change any tariff. For any subsidy scheme, this could spell disaster — resulting in uncertainty and a lack of ability to prepare for the future, as the government could hypothetically make changes as they see fit.
This, in turn, is likely to wrong-foot any investor considering subsidy schemes, destroying investor as well as consumer confidence in one swipe and leaving people on tenderhooks over future tariff rates.
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