High Court Rules ‘Panic’ Cuts To Feed-In Tariffs Are Potentially Illegal
Date of Article
Dec 22 2011

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London, 22 December 2011, Environmental campaigners are this week feeling buoyant following the High Court ruling that the Energy Secretary’s drastic proposal of a 50 per cent cut to solar PV subsidies back in October is ‘legally flawed.’

Whilst a review of the Feed-in Tariffs was always due in 2012; due to the overwhelming uptake in solar PV, the Department of Energy and Climate Change (DECC) had proposed that current Feed-in Tariffs were not in their view sustainable for solar PV and that they would be cut radically. Dramatically in October, the DECC brought forward the review and announced that any project registered after 12 December 2011 would be downgraded to the lower rate from April 1 2012, after initially receiving the current higher tariff.

This proposal, designed to save the Coalition £700m a year by 2014-15, sent shock waves through the renewable energy sector; who feared that such a knee-jerk reaction would destabilize parts of the renewable energy industry, not only in terms of investor confidence but also the supply chain and employment levels.
Yesterday, Friends of the Earth and two leading solar PV companies, HomeSun and Solarcentury challenged this decision at the High Court and were relieved to hear judge Mr Justice Mitting’s ruling that DECC’s actions were potentially illegal, and can now be subject to a judicial review.

Friends of the Earth's executive director, Andy Atkins, said: "We hope this ruling will prevent Ministers rushing through damaging changes to clean energy subsidies - giving solar firms a much-needed confidence boost.”

"Ministers must now come up with a sensible plan that protects the UK's solar industry and allows cash-strapped homes and businesses to free themselves from expensive fossil fuels by plugging into clean energy."
The Government is now set to appeal the decision for a Judicial Review and DECC has been instructed to submit an appeal request by 4 January, 2012. If this appeal is denied and DECC loses the Judicial Review, then the Coalition will be forced to reconsider its strategy for solar subsidies.

“Theoretically this would be a triumph for the solar industry, consequentially however the phase 2 Review consultation will be delayed further and the renewable energy sector yet again left in limbo,” comments Andrew Watkin, head of the Energy and Marine Team at Carter Jonas.

 “We are delighted with the news that DECC has been challenged over its impulsive and ill considered approach to dealing with the solar industry. Whilst it is no doubt humbling for them to be on the receiving end for once, especially bearing in mind the FiT cut earlier in the year to curtail solar park developments, let’s hope that they come forward with a rational strategy by which we can all move forward with confidence to help try and achieve the targets set by 2020.”

According to Indre Vaizgelaite of Renewable UK,  “DECC have advised that until proposals in regards to new tariff rates are brought forward by DECC and passed by Parliament, the tariffs for all technologies will remain as currently set out in secondary legislation, including any published degression already built in from 1st April 2012.”