Today marks deadline day for solar photovoltaics installations in the UK, which will receive heavily reduced feed-in tariff payments from April next year if Government pursues its latest policy proposal.

The ongoing feed-in tariff consultation, which seeks to reduce the incentive rates for PV systems up to 250kW, will not actually conclude until December 23, yet all systems installed after today will receive the lower rates come April, if the cuts go ahead as planned.

Government’s decision to impose the cut-off point 12 days before the consultation ends has prompted a great amount of disruption within the UK solar industry – with many questioning the move’s legality.

The situation

Outlined in the Department of Energy and Climate Change (DECC) proposals are FiT cuts of more than 50 percent for microgeneration systems, which will now receive 21p instead of the previous 43.3p per kilowatt hour. Aggregated systems, such as social housing projects and so-called rent-a-roof schemes could see even deeper cuts to incentives.

Government has also suggested imposing a EPC requirement of Level C before UK consumers can install PV systems – a benchmark which many argue is simply not possible for 50 percent of the UK housing stock.

The backlash

Since the announcement on October 31 – which gave the UK solar industry just six weeks to complete projects – campaigns against the proposals have been launched in a bid to try and get the decision turned over. Action came from Friends of the Earth, a group of solar companies headed up by Solarcentury, and the Cut don’t Kill lobbyists, who were joined by Green MP Caroline Lucas, Caroline Flint MP and former Labour MP Alan Simpson.

Photon Energy's Director, Jonathan Bates, highlights a common view in response to the annoucement:

“The very fact that the proposed reductions will take place from December 13, despite the consultation period not closing until December 23, presents clear concerns about the integrity of the process and whether it is simply a pre-determined outcome,” he said.

“What it means is that the industry will effectively come to a complete halt from December 13 until the final outcome of the consultation is announced, as customers won’t commit to installations amidst this hiatus. If the DECC wanted to actively destroy an industry, it couldn’t have done a better job.

“The industry accepts that tariff reductions were required this year, given that installation prices have fallen by 30 per cent since the FIT scheme was introduced in April 2010. However the DECC is panicking, as evidenced by its second ‘urgent review’ in less than six months, and is proposing overly drastic cuts.”

However, despite industry’s best attempts to overturn the decision, Government insisted that action needed to be taken – and fast – due to budgetary restraints.

Charles Hendry MP, said: “I think what we have done is to put right a bad system. This was based initially on a presumed right of return of 5 percent. Because the last of the technology has come down so much, people are getting a rate of return on the investment of over 10 percent, tax free for 25 years, put on everyone else's electricity bills.”

“That's simply unaffordable,” he continued.

The future

While many were outraged by the proposals, a large amount of those working in the UK solar industry say they accept the cuts needed to happen in order to create a sustainable future. In fact, in most cases it was the six-week timeframe that caused the most amount of disruption – forcing many to work around the clock to complete projects, causing the MCS registration website to crash last week due to the sheer volume of those trying to log on. In fact, the latest DECC figures show that more than 83MW was added to the database last week alone.

Today, the main concern in industry is the future of the UK solar industry, and in particular: jobs. With just two weeks before Christmas, fears are mounting that redundancies are on the horizon. According to the latest reports, approximately 20,000 positions are at risk, potentially adding to the vast amount of unemployment in the UK.

Robert Goss, MD of Conergy in the UK said, “Coming before the consultation is complete, the feed-in-tariff cuts looks like a pre-emptive strike by the Government. They should certainly be thinking about how they can bridge the gap for solar between now and the Green Deal coming on stream.”


While Howard Johns, Chairman of the Solar Trade Association (STA) said, “I've got a list of companies where 80 percent of staff are going through consultation for redundancy.”

“A lot of people in the solar industry have diversified out of other areas because those areas are in serious recession,” he continued.

Results of the consultation are expected some time in January, although no date has been officially announced.