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Government loses feed-in tariff appeal, but uncertainty continues

26 January 2012

While the government failed to overturn last month's ruling that its rushed cuts to the feed-in tariff for solar PV are unlawful yesterday, the uncertainty over the rates still exists. As soon as the unanimous verdict was announced in the Court of Appeal, the Secretary of State for Energy and Climate Change, Chris Huhne announced that his department would seek permission to appeal to the Supreme Court.

What does this mean?

As a result, people who want to install solar panels between now and 3 March 2012 still do not know what rate of feed-in tariff they will get. If the government's appeal is granted it will be 43.3p per kWh generated for systems up to 4kW in size for the 25 year duration of the scheme. However, if the government loses it will be 43.3p until 31 March this year, then 21p for the remainder of the scheme. The 3.1p per kWh export rate is not affected.

Mipower will be able to advise potential owners of the current situation as this becomes clearer

Specialist installers of Solar Power - The Benefits

On the 1st April 2010, Feed-In-Tariffs (FIT’s) were introduced. Very simply they are a new Government backed measure to make it worth your while to produce renewable electricity.

The aim of FIT’s is to help Home Owners, Housing Associations, Small Businesses and other Community Groups start to make the “big energy shift” to a low carbon economy and contribute to the Governments 2020 Renewable Energy Targets.

The Products and Installation

The company employs fully trained professionals to survey, design and install the best quality Solar PV (photovoltaic) products from major manufacturers such as Mitsubishi, Sharp, Schüco and BP Solar which include a 25 year performance warranty.

About MiPower

High Court Action and the latest on Tariffs Filed in News items

22/12/12 - The widely publicised court action between Friends of the Earth, solar companies and the Government has swung in favour of the solar industry with the Court ruling that the fast track solar subsidy cuts were legally flawed.

Whilst this appears to be good news for those who failed to make the deadline it still creates uncertainty. The REA (Renewable Energy Association) provides an overview of what the ruling means for customers:

Judicial Review - Friends of Earth/HomeSun/Solarcentury win case against government on solar

The implications of the JR decision mean that the pre 12th December tariffs cannot be changed until after the full parliamentary process – i.e. an 8 week consultation, followed by a review of the responses and then a 40 day period before the legislation takes effect. This is unless the Government wins an appeal.

Government was not given leave to appeal, but if it wants to make a case it must put that forward by 4th January 2012.

Effectively the situation for systems going in now is one of two things.

• If Government is able to appeal, and then wins, we go back to the current situation. I.e. there is a consultation ongoing, and a domestic system can expect to earn 21p (or whatever government concludes after the consultation) from 1st April.

• If government is not able to appeal, or if it loses on appeal, then the 43p tariff remains in place until the Parliamentary process has concluded (expected to be 1st April 2012).

MiPower Comment

We recommend that anyone considering solar pv should install before the April deadline, it is highly likely that further measures will be introduced at this time that will make it harder for homeowners to install solar pv, such as energy efficiency measures. If the tariff reverts to 43p, then customers will be rewarded, if it remains at 21p they will still get a 10% average return on their investment.

Important Announcement For Companies Wishing To Install Solar Panels

Companies need to act now on installing solar panels if they are to beat Government reductions in incentives.  

Opportunities exist to claim back installation costs, but these mostly run out from April 2012. 

Despite Government cuts to the feed-in-tariff scheme from April 2012 – how much can be earned from the electricity generated – renewable energy will continue to expand. 

The annual investment allowance (AIA) means companies can write off the cost of plant and machinery up to £100,000. But this is being reduced to £25,000 from April. 

“Solar panels that generate electricity qualify for AIA, so companies need to move quickly if they are to take full advantage. 

“Given the complexities of this any companies thinking of undertaking installations need to take action as soon as possible to maximize the taxation advantages” 

“For the moment there are still very worthwhile tax advantages to be had. Firms need to do the maths, decide whether they want to proceed, and, if so, get on with it.” 

There are also intangible benefits in pressing ahead with solar power. 

“It is not just a financial decision; there is your company’s image to consider. If you can project yourself as a ‘green’ business then you will tend to be viewed as go-ahead and innovative. That can have beneficial results when dealing with clients. 

Contact the MiPower experts now for your detailed analysis whether you are an incorporated Company or private individual. 

10th January 2012.