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UK: Solar installers and developers sue government for £140m

A group of British "solar and construction companies" has announced its intention to claim £140 million (US$222 million) in damages against the government of its handling of reductions to the solar FIT in 2011 and 2012.

While the photovoltaic market in the UK appears to have become more stable, damages are being sought over the government's handling of the FIT reductions.

Flickr/ell brown

Labeled a "fiasco" by parts of the industry, the reductions in the FIT for photovoltaics in the UK has been a long-running drama. Initially set at £0.43/kWh (US$0.69/kWh), in October 2011 the government indicated that it would cut the rate to £0.21/kWh, to come into effect on December 12. This date was then delayed until March 3, after legal appeals.

The government claimed that the falling cost of photovoltaics and the potential cost blowout of the FIT scheme were the reasons behind the dramatic reduction of the FIT. The solar industry opposed the sudden and dramatic cuts, claiming that they were in fact illegal as it was brought in before a government consultation period had concluded.

NGO Friends of the Earth along with the solar industry took the battle to the High Court, the Court of Appeal and then the Supreme Court over the issue and succeeded in delaying the measures. The law firm Prospect Law, which was successful in these previous cases, will represent the solar and construction firms in the new claim announced today.

17 companies are to be represented in the claim against the Department of Energy and Climate Change (DECC).

The claim is based not on the justification behind the government cuts, but rather the manner in which it was carried out, which saw public confidence in photovoltaics plummet and the number of installations drop by as much as 90%.

In a statement announcing the legal action, Simon Gillet from one of the claimants E-tricity said: "Last year should have been our year for growth, innovation, investment and training, but instead it was an ‘annus horriblus’ peppered with cut backs, customer confusion, part time working, stress and redundancies."

Gillet’s statement also indicates that the photovoltaic market in the UK has now stabilized and the new FIT regime secure.

Reacting to the legal claim, the opposition Labour Party’s spokesman said that the cuts had gone too far and were implemented too quickly. "Thousands of people lost their jobs, many businesses in the solar industry saw their order books dry up and the number of people installing solar panels slumped. Ministers must come clean about why they pushed ahead with their unlawful plans and what legal advice they got in the first place."

The forthcoming February edition of pv magazine features a special feature article on the UK solar market in 2013.