Solar Subsidies in Shambles?

It’s not yet been officially confirmed, but according to a leaked report, the Government is to slash solar subsidies by more than half their current rate.

Earlier today, the Energy Saving Trust (EST) accidentally published online a document which revealed the level of cuts the Government intends to make to solar subsidies. Currently set at 43.3p per kilowatt hour, that figure will be slashed to 21p.

Although the EST has since put out a press statement which stresses that the proposals remain under consultation, but given that rumours have been flying around the media for days, purporting to cuts ranging from 20p to 9p, the damage is clearly already done.

Due to continued speculation in the media, the solar industry has been trying to brace itself for some inevitable changes. However, insiders say that although larger solar companies will be able to weather the change, such drastic cuts to the feed-in tariff (Fit) scheme will be crippling for smaller solar firms.

Speaking to the Guardian, Howard Johns, MD of Southern Solar said: “If they go ahead with this, the tariff is way too low, and all the social housing and free solar schemes – which make the feed-in tariffs exciting in terms of fuel poverty – will be destroyed.”

So severe are the proposed cuts, it will almost certainly hit community projects the hardest. And schemes which provide cheap electricity to low-income homes look certain to be scrapped.

“In the residential sector, providers of free solar panels are around 50% of installations and they will disappear at anything less than 28p per kWh,” said Daniel Green of HomeSun, who fit solar PV panels for free to benefit from the feed-in tariff subsidies.

“This means the less well-off will not be able to benefit from solar,” he added.

Full proposals are set to be announced in Parliament on Monday.

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