Solar industry berates UK government's subsidy withdrawal

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The U.K.’s solar and renewables industry has reacted angrily today to the news that the Department for Energy and Climate Change (DECC) is to withdraw subsidy support for vast portions of the industry from April 2016.

The announcement today that DECC has published proposals to end the Renewable Obligation Certificate (ROC) scheme for solar farms smaller than 5 MW on April 1 2016 has dismayed the solar industry, with the Solar Trade Association (STA) stating that the proposals are a huge blow to investor confidence.

"This is damaging for big solar rooftops as well as solar farms, both very cost-effective ways of generating solar power," said STA’s head of external affairs Leonie Greene. "This contrasts with repeated commitments from government to boost the commercial solar rooftop market."

The proposal to end grandfathering of solar projects – which had guaranteed a certain level of subsidy throughout the lifetime of a completed solar farm – also came in for criticism, with Greene stating that its removal is “a real blow to investor confidence".

Stressing the STA’s disappointment, Greene added: "Solar is the nation’s most popular form of energy, as the government’s own opinion polls have shown. We recognize that the government wants to shift the emphasis to larger solar rooftops, but we have explained to DECC that these are just 5% of the U.K. market. More work is urgently needed to unlock larger solar roofs. There is a danger if the government pulls the rug on solar farms too early, the market will have nowhere to go."

STA added that they are keen to work with DECC on a bridging strategy designed to aid solar’s transition from subsidy reliant to subsidy independent, stating that it is "just a few quid more" on energy bills to deliver a solar power revolution in the U.K. Under the ROC, solar costs just three pounds per year on each household bill, and makes up just 6% of the ROC budget.

DECC’s decision to remove the pre-accreditation for the FIT on projects larger than 50 kW was also criticized. "The removal of the ability to pre-accredit a project and lock in at a set level of support, will make it harder to do both commercial rooftop and community solar schemes," Greene said.

No blank cheque

Solarcentury’s head of external affairs, Seb Berry, was also quick to lambast DECC and the Conservative government’s lack of support for the solar industry. "After delivering price falls of 80% since the introduction of the FIT, nobody is asking for a blank cheque, just a sensible, transparent and predictable transition to subsidy-free solar by 2020/21, as set out in the STA Solar Independence Plan," Berry said.

DECC’s announcement undermines this process, he added, serving to once again remove policy stability that had proved so attractive to solar developers and investors. "We get that the government doesn’t like solar farms but we simply don’t understand today’s shock proposal to remove FIT pre-accreditation for mid-scale rooftop solar projects. This is the sector that the former Minister used to say should receive ‘rocket-boosters’ from government. Today’s announcement will do the opposite."

Renewable energy association Regen SW’s chief executive Merlin Hyman remarked that DECC’s announcement puts at risk substantial investments already made in solar projects – a move that will damage already-shaky confidence. "This undermines the U.K.’s reputation as a secure market to invest in," Hyman said.

Greenpeace’s head of energy campaign Daisy Sands echoed these words. "Cutting the subsidies now will see businesses go bust and investment dry up. Jobs will go an emissions will stay higher at a time when policies and funding should be in place to ensure quite the opposite," Sands said.