Some of the leading names in the UK’s renewable energy industry have sent out a warning the Government that a premature cut to feed-in tariff subsidies could damage the sector to a point of no return.
The letter, signed by more than 60 figureheads in the renewable industry, outlines how, “The “feed-in-tariff” that guarantees small-scale producers of renewable and low carbon electricity a long-term fixed price for their power has given investors the confidence to grow an industry rapidly and in line with the Government’s expectations.”
However, it then cautions that, “Premature adjustments to the tariff would have a profoundly damaging effect on long-term investor confidence in the clean tech and renewable energy sectors, and may cause investors to flee altogether, thereby stifling any future investment and seriously jeopardizing this country’s ability to meet its climate change and renewable energy targets.”
Industry executives, including representatives from E.ON, British Gas, Solarcentury and Solar Sense UK sign the letter, urging the Chief Secretary to the Treasury and the Secretary of State Business, Innovation and Skills to “leave feed-in-tariffs well alone, at least until April 2013.”
This warning follows mounting press speculation in recent weeks,that as part of the Comprehensive Spending Review, the Treasury might force the Department of Energy and Climate Change (DECC) to cut the feed-in-tariff paid to producers of low carbon electricity ahead of a planned review of tariff levels due in 2013.
Micropower Council Chief Executive, Dave Sowden said, “No right-minded investor will trust any of this Government’s current or future policies if it meddles with feed-in-tariffs prior to the planned review in 2013. Without confident investors, the Government will find it impossible to deliver the country’s CO2 reduction and renewable energy commitments.
“Customers are already responding to this speculation by cancelling orders ‘in case the feed-in-tariff gets scrapped’. Thousands of jobs and hundreds of millions of pounds of investment are now hanging by a thread. It is therefore vital that the Government squash this speculation without delay by confirming it will honour the current feed-in-tariffs.”
The letter comes just a month after a similar plea was sent to Chris Huhne by 22 green groups back on September 9, again warning that cuts to the feed-in tariff would jeopardize the renewables industry in the UK.