The opposition day defeat has left the solar industry with little option but to brace itself and prepare for the introduction of the new 21p/kWh rate proposed by the Government.
The new rate will come into effect on December 12. The consultation on the proposed changes ends December 23.
The very fact that the consultation period ends after the proposed changes come into effect has left the Government open to legal challenges and, most recently, an attack from Sainsbury’s Chief Executive, Justin King, who confronted Chris Huhne on BBC’s Question Time.
King pointed out the hypocrisy in Huhne’s statement that: “It was never the Government’s intention to reach a conclusion until a consultation process is complete” by noting that this is exactly what is currently happening with the feed-in tariff.
So what are solar installers supposed to do for those 11 days in December when they are left in the limbo between the introduction of the new rate and the confirmation of the rate moving forward?
In order to comply with the REAL code, a return on investment calculation must be included in any quote sent out to a customer. So what figure do you use for your calculation – the 21p figure?
If you listened to the debate in Commons on Wednesday then you would have heard both Barker and Huhne repeatedly pledge that this will be “a proper consultation”.
If they are to be believed then solar professionals should be very hesitant about using the proposed rate and even more hesitant about putting the proposed rate down in writing for any potential customers, as, after due consideration during the consultation period, the proposed rate might well be revised.
Cynics amongst us will remember the outcome of the last fast-track review for large-scale solar subsidies: the rate remained exactly the same as proposed, despite a number of sensible suggestions being put forward. Many in the industry fear that the current consultation period won’t be any different.
But it could very well be even worse than that. There is the distinct possibility that the bubble created by the scandalous six-week period between announcement and cuts will lead to a further reduction of the proposed 21p rate. The gold rush created by the deadline will further drain the budget set aside for the feed-in tariff and may cause the rate to be revised downward to combat the sudden rise in installations.
All of this brings us back to the main point: how are solar companies supposed to operate in a period with no tariff set in stone?
From speaking to those in the industry it seems that the only option is to turn away business, either through an extended Christmas break or by simply telling customers to wait until January when a new rate might be confirmed.
Or maybe we should try appealing to Westminster’s emotional side and gather together in a collective Christmas choir to serenade the Government about the plight of the solar worker, only to have Ebenezer Scrooge slam the door in our face once more.
The idiocy of turning away business in today’s climate cannot be overstated, yet this is where the industry has been left. The mishandling of the feed-in tariff serves as another reminder to the industry that grid-parity can’t come soon enough.
For now, the support of solar technology by governmental subsidies is a necessary evil that we must accept if the industry is to scale up and compete with fossil fuels in any meaningful way.
