Solar power industry warns 18,000 jobs at risk from 65% cut in feed-in tariff

solar roof panels Clean Energy Installations PV PanelsMore than 18,000 jobs in the solar power industry could be lost as a result of the 65% cut in the feed-in tariff rate announced by the UK government today.

The new rate was confirmed in a Department of Energy and Climate Change (DECC) report showing that financial aid of 4.39p per kilowatt hour will be available from next month instead of the existing 12.47p.

The solar industry and its supply chain consists of 3,000 small and medium sized businesses and employs 35,000 people, providing more value to the UK economy than many other low-carbon technologies.

The Solar Trade Association knows of 1,800 jobs that have already been lost, and estimates that a total of 6,500 jobs have already been lost, and three businesses that have gone bankrupt since the Government published its proposals for the Feed-in Tariff review, with a survey suggesting many thousands more on notice.

The association had previously estimated that if the 87% cut to tariffs were implemented next year 27,000 jobs would be at risk.

Paul Barwell, Chief Executive of the Solar Trade Association, said: “Government has partially listened. It’s not what we needed, but it’s better than the original proposals, and we will continue to push for a better deal for what will inevitably be a more consolidated industry with fewer companies.

“However, in a world that has just committed to strengthened climate action in Paris and which sees solar as the future, the UK Government needs to get behind the British solar industry.

“Allocating only around 1% of its clean power budget to new solar is too little, particularly when solar is now so cost-effective. Poor ambition for solar risks missing out on not only our renewable energy targets in the UK, but on the world’s greatest economic opportunity too.”

The new rate cuts domestic tariffs by 64% to 4.39p/kWh instead of the original proposal of cuts of up to 87% to 1.63p/kWh.

This is compared to a rate of 12p/kWh today.

For a modest commercial rooftop scheme the size of a school or small commercial building, the Feed-in Tariff rate will be 4.59p/kWh.

The new tariffs will come into force from 8 February 2016 and the deadline for projects to receive the current higher tariffs is now 15 January 2016.

Juliet Davenport, Chief Executive of green energy supplier Good Energy – which is one of the largest Feed-in Tariff administrators in the UK – commented:

“The Feed-in Tariff has transformed how the UK generates electricity with more than 750,000 homes now generating their own power. It’s helped move us away from fossil fuels towards a cleaner, local, more democratic energy system.

“The new measures are a slight improvement on the original proposals but still mean that installing solar panels will no longer be attractive to British home-owners and the changes will also make it harder for housing associations and councils to use FIT to help those in fuel poverty.”

The Government has also confirmed its decision to close the Renewables Obligation from 1 April 2016 to all solar projects, both rooftop and ground mounted – in England.

In Scotland, the SNP Government at Holyrood – which has devolved powers on this issue – has decided not to follow the Department of Energy and Climate Change in London and maintain the grandfathering guarantee.

The Scottish Government cited ‘investor confidence’ as a key reason for doing so – a move which was welcomed by the solar sector in Scotland.

 

 

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