Changes to solar subsidies threatens jobs and investor confidence

The government is set to launch a review of the solar industry’s subsidies, which may favour industrial rooftop installations over large-scale solar farms. The sector is concerned that another change of policy might harm investment in the sector.

The green website BusinessGreen said that major changes may occur as the Department of Energy and Climate Change (DECC) prepares to announce a review of solar subsidies. While this has yet to be confirmed, it is believed that commercial-scale rooftop installations on offices, factories, supermarkets would be encouraged – as announced recently in the government’s Solar Strategy.

On the other hand, large solar farms might see their subsidies scrapped because of their impact on the countryside. An anonymous government source said that following the Solar Strategy on rooftop installations, it was “only a question of when, not if, they were going to look at cutting the subsidy for solar farms”.

The move has worried the industry, which says investors might lose trust and changes could put jobs at risk.

The Renewable Energy Association’s chief executive Nina Skorupska said, “Drastic changes to policy – to which solar power is no stranger – can lead to job losses and damage investor confidence across the renewables industry. We urge DECC to tread very carefully if it does indeed plan to review the support mechanisms for large scale solar. This sector is creating jobs and bringing down costs rapidly.”

Meanwhile, Paul Barwell, chief executive of the Solar Trade Association, added, “We are disappointed to read that DECC is launching another review on the solar industry. Investor confidence and market stability is absolutely essential in order to deliver sustained cost reductions for consumers and a healthy solar industry for UK plc. We are obviously on tenterhooks to see what changes DECC is proposing to make.”

The Conservative party recently announced that if it wins the general election in 2015, it will cut support to onshore wind farms.

Photo: visual_k via flickr

Further reading:

Public support for renewables grows as concern over fracking rises

Pressure on energy bills rises as national renewable power policy gets a makeover

Rising energy bills prompt David Cameron to announce green tax review

Plans to turn solar farms into biodiversity hotspots unveiled

Government sets out plans for ‘solar hubs’