The tariffs have stimulated demand for consumers to generate their own low carbon electricity, a welcome shot in the arm for employers facing an uncertain future in these financially difficult times. The problem seems to be that, with a limited pot of money available, FiTs have just been too effective at stimulating demand, leading the Government to make the decision that the tariff must be cut quickly from 43p/kW to 21p/kW in order to make the scheme sustainable. We don’t know if such a strong reaction from the solar PV industry was expected – but there’s no denying it has generated heated debate. Like many others, we noted with interest the outcome of a legal challenge to the Government’s decision to cut the tariff before its own consultation had ended. The challenge, brought by Friends of the Earth and two solar PV companies, found that there was a case for the Government to answer in prematurely reducing the tariffs. Since this judgement, the Government has appealed the ruling and at the time of writing, it is not clear what the final outcome will be.
As a result of our own consultation and everyday interaction with employers and their representatives, we strongly suspect that what was a growing solar PV industry is experiencing a giant hiccup which has shaken it to the very core. More worryingly, at our recent Green Deal Connections events (organised with our Green Deal Skills Alliance partners Asset Skills and ConstructionSkills) we found that the Government’s action seems to have sown a seed of doubt in potential installers’ and customers’ minds about getting involved any time soon in the drive to improve the energy efficiency of the country.
Many employers had invested in training to take advantage of this opportunity, employing extra staff in order to meet growing consumer demand for solar panels. Now those staff are once again facing an uncertain future.
This could be seriously bad news for us all. There is such potential in renewables and our sector should be preparing now in order to tap into that potential. Waiting months to see what happens is not an option for many employers or potential installers. Consumers and businesses have already shown that they are interested if the incentive is right. Of course Feed-in Tariffs need to be sustainable, and managing this financial incentive alongside the growing solar PV market is a delicate balancing act, but we need to ensure that this is a bump in road – and not a dead end.
For more information on this story, click here: February 2012, 6