Friends of the Earth joined Solar Installation companies to bring the legal case to the Royal Court of Justice.
A High Court ruling on subsidies for households has been welcomed by the industry. Judges rules on Wednesday the 23rd December 2011 that the decision to bring the move forward to December was legally flawed.
It is expected that the drop in subsidies will hit the industry hard, with fewer installations having a knock on effect on firms profitability.
Many Solar panel industry firms are arguing that they had planned for these changes to take effect in April and the earlier than expected changes will effect their businesses and has left them with no time to plan.
The decision to cut the tariff led to a stampede of last minute installers cashing in on the higher FIT tariff rate before it was too late.
However, most solar panel companies are now facing empty books for the new year and much more difficult sales processes.
“From January on, they have absolutely nothing. Some of the firms are facing up to 60-70% reduction in their workforce.” said the Plain Cymru MP.
Under the UK’s feed-in tariff program, people in Britain with solar panels are paid by the kWh for the electricity they generate.
The changes have meant that the feed-in tariff has been abruptly changed to well below halve of it’s original value of £43.0p p/kWh to £21.0p p/kWh. It had previously been expected that this would not come into effect until the 1st of April at the new budget, however the Government have rushed through the expected change, stating only systems before the 12th of December 2011 will be allowed to get the old tariff. This would seem like a direct attempt to stem a growing industry that could / has caused large amounts of money to haemorrhage from the fund.
The Export Tariff will stay the same at around £3.1p p/kWh.
The UK Government have justified the cut, by announcing that the cut was necessary to ensure that the scheme carries on in the future.
Mounting pressure from the industry, many will hope, may turn the UK Government into a U-turn over Solar energy. Despite this, the Government have also said they would defend any challenge at judicial review.