GOVERNMENT subsidies for household solar electricity are set to be slashed in a move that has caused widespread outrage in the industry.
From next April subsidies for small-scale installations will be halved for installations made after the cut-off point of December 12 - just six days away.
Industry leaders say the cuts could seriously damage the energy sector and the thousands of jobs it provides. Some say it could even put small solar power installation companies out of business altogether.
Marske green energy installer Elf Eco Renewables said the Government needed to revisit its priorities and come up with a concise plan for securing energy supplies for the future. Company owner David Maloney said: “They are looking at subsidies for large-scale wind and nuclear power but that has not been filtered down to solar photovoltaics.
“Some solar power companies that are geared up for the domestic market could fold.
“People are still locked on price when it comes to renewable energy devices.
“They will only buy into green schemes if there are sufficient incentives to do so.”
More than 44,000 solar installations have been registered under the FIT, which gives homeowners cash for the electricity they generate from solar installations.
But the depth of the cuts - more than 50% in some cases - and the timing of them has left the industry reeling. The cuts were originally expected to come into force next year when they were originally announced in October. But the earlier deadline has meant some firms have had to turn down work to service existing orders.
Eco Environments which installs solar panels, heat pumps and wind turbines across Teesside said it had missed out on vital business.
Director David Hunt said: “We accepted three months’ orders in two weeks and could have taken on six months’ orders if we hadn’t closed the order books to ensure that we could deliver schemes ahead of December 12. We knew and accepted that the current subsidy level of 43.3p for smaller domestic and commercial solar PV installations was coming to an end.
“What shocked us and the industry as a whole was the extent of the cut and the speed with which it is being implemented.”
But others say the subsidy cuts are necessary to create a sustainable solar power industry.
Online resource Solar Power Portal said the subsidies had helped to stimulate demand but eventually the industry had to stand on its own two feet. Speaking at a recent conference in Durham, Emma Hughes, editor of SPP, said: “We’re hoping that in the next couple of years there won’t be any need for a feed-in tariff and that the cost of PV will be the same as using conventional power.
“The Government has realised that they need to act now to sustain the industry to prevent a boom and bust scenario. If no action is taken, Government will find itself in a position where it has to cut off the feed-in tariff system before we reach grid parity. With PV prices continuing to fall and energy prices rising, grid parity is moving even closer.”
The conference, the third annual Solar Flair event, saw major players in the industry discuss how businesses could best capitalise on the solar power revolution. But there’s a danger the revolution will falter once the cuts take effect.