DECC statement seeks to reduce solar FiT uncertainty

Following the uncertainty generated by the Department of Energy and Climate Change (DECC) decision to appeal the High Court’s ruling against the “unlawful” feed-in tariff deadline,  an attempt has been made by Government to restore faith and ensure business can still be carried out. On Friday afternoon the Department released a statement confirming 4kW tariff rates until March 31, 2012, assuming its appeal is heard.

With fears beginning to mount that the tariff could be reduced to less than 21p as a result of the Judicial Review, many companies are unsure on what to say to new customers due to the uncertainty surrounding the future rates. So, following confirmation that there will be a hearing of its appeal against the JR, DECC has published the following statement, which it hopes will reduce the uncertainty:

“The tariff rate for PV installations less than or equal to 4kW will not fall below 21p for installations with an eligibility date between 12th December 2011 and March 31, 2012.”

DECC appeal permission hearing will be January Friday 13, which will be followed by the full hearing, if permitted, the same day.  The findings won't be announced until the following week.

If DECC wins its case, it intends to publish its response to the consultation on or around the January 31 – which is the earliest date it can do so – along with the Phase 2 Comprehensive review.  However, the proposals in the Phase 2 consultation are likely to depend on what the result of the Judicial Review is and the amount of PV that has been installed since December 12.

In the event that DECC loses its appeal it may turn to the Supreme Court.  It is unclear at present what the implications of this will be.

According to Solar Power Portal’s calculations, the FiT budget is already blown. So if the appeal is lost, DECC may be forced to reduce the tariff for all PV systems installed post April 1 to just 9p kWh (equivalent to 2ROCs), however DECC Officials have stressed that this is not the preferred outcome.

Further updates will be published in due course.