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Friends of the Earth is urging the Government to re-think its plans to slash payments for solar electricity schemes today (Monday 12 December 2011), as the rush to install solar payments ahead of a crucial payment deadline comes to an end.

The Government has halved the payments for any solar electricity scheme completed from today, which will almost double the payback period for homes, businesses and communities.

Later this week (Thursday 15 December 2011) Friends of the Earth and two solar companies – Solarcentury and HomeSun – will ask the High Court for permission to challenge Government plans to cut the payments.

The premature cuts could cost up to 29,000 jobs and lose the Treasury up to £230 million a year in tax income, a report commissioned by Friends of the Earth and Cut Don’t Kill – an alliance of solar firms and consumer and environmental organisations – revealed last month. Earlier this month construction firm Carillion warned 4,500 workers their jobs are at risk because of the Government’s proposals.

Countless schemes have already been abandoned, denying cash-strapped homes and businesses the chance to free themselves from soaring fossil fuel prices.

Friends of the Earth’s Executive Director Andy Atkins said:

“These Government cuts will cast a huge shadow over our thriving solar industry and pull the plug on thousands of jobs.

“We don’t oppose modest payment cuts in line with falling installation costs – but the size and speed of these proposals will decimate an industry that could play a key role in weaning the nation off of expensive fossil fuels.

“Ministers must think again and give their support to an industry that could and should be at the cutting edge of a clean energy revolution.”

The Government’s rationale for cutting the Feed-in Tariff for Solar PV so fast and so drastically is that it is a necessary measure in order to keep expenditure of Feed-in Tariffs in check. Many reports in the media and statements by ministers themselves have suggested that Solar PV is costing households a large amount on their energy bills (the Feed-in Tariff is considered levy on energy bills by the Treasury and therefore labelled a form of taxation). We are concerned that the Government and the large energy companies are not being transparent about how much of taxpayers money gets spent on the various energy technologies and misleading people into believing the cost of renewable is higher than it really is.

As an example, according to an email seen by Engensa from the energy regulator Ofgem, officials have calculated that the cost of the Feed-in Tariff to household energy bills is less than £1 per year. This agrees with Engensa’s own research found here. In contrast, the UK tax payer pays hundreds of times more than this towards the cost of decommissioning nuclear power stations and looking after the nuclear waste they generate. According to the Government’s own figures, £6.93bn of taxpayers money was given to the Nuclear Decommissioning Authority in 2010-2011, which equates to £260 per household.

As Green Party leader Caroline Lucas MP pointed out in a recent speech, when there are dozens of Big 6 employees working inside Parliament contributing to policy as secondees, and hordes of energy company lobbyists pushing for the decisions they want, it is very important that the Government is absolutely transparent about the costs and benefits of the various options so that the public, not big companies, can decide.

www.engensa.com

Commenting on news that services company Carillion has told 4,500 staff that their jobs are at risk following plans to halve subsidies on solar power, Friends of the Earth’s Energy Campaigner Donna Hume warned:

“This is just the tip of the iceberg – if Ministers push ahead with plans to slash solar subsidies tens of thousands of jobs could be lost.

“A fraction of the cash the Chancellor set aside this week for more roads and dirty energy would throw a lifeline to the solar industry and the thousands of skilled workers currently facing unempolyment.

“The solar industry has a crucial role in reducing the nation’s dependency on expensive fossil fuels and developing the clean future David Cameron has repeatedly promised – Ministers must abandon plans to pull the plug on it.”

Yesterday saw an explosion in productivity at the rumor mill regarding the solar energy Feed-in Tariff (FiT) and it’s impending review. With sources from all over the industry and high exposure media such as Financial Times jumping on board the scaremongering bandwagon, let’s take stock once again and remember the facts of where we are up to.

To read the full article, click here.

The Feed-in Tariff Review

As we understand it, the Comprehensive Spending Review championing the government’s budget overhaul into spending includes a review of the solar FiT. The Department of Energy and Climate Change (DECC) is the authority on this matter, and only their official release will bring about the changes and outline to what extent cuts will be made.

One thing that figures from Ofgem are highlighting is that installation rates are much higher than what they anticipated. The current rates cannot be sustained at this exponential growth level. The boom is most certainly in full swing, and the bust now appears to be approaching in all its foreboding and unstoppable glory.

“Unless Earlier Action is Deemed Necessary”

The DECC, in speaking with industry sources has released the following statement:

“As we’ve previously said, all tariffs in the scheme are being considered in the Comprehensive Review and we will be consulting on proposals later this year. We’ve made clear that tariffs will remain unchanged until April 2012 unless the review indicates the need for greater urgency. There has been no announcement about the review so any rumors about its content are just that, rumours and speculation.” (Source)

In simple terms, nothing has changed at this point and we are no closer to understanding exactly when they will. The media storm has cracked through the sky, but the underlying realities of our situation remain. There is little doubt that the review will decrease the FiT rate by some extent, and also increasingly less doubt that the changes will be brought about before April 2012.

The only concrete truths the industry has to offer are that if you’re installed prior to the changes you will receive an enviable rate on your solar power for many, many years. If you do not, you won’t.

Written by Jarrah Harburn

jarrah@solarselections.co.uk

T: 0844 567 9835

© Solar Selections Pty Ltd 2011