Green incentives could rise following legal battle

Solar panels firms believe that financial incentives for installing green technology could rise, following a recent legal case.

The government recently halved the financial incentives for installing solar panels on the home. This decision has been challenged by Friends of the Earth and two solar panels companies, and upheld in the High Court.

According to North West based solar panel firm BSOLAR, this could mean that the government will have to go through another consultation process in January, and during this process increase the incentives back to their original, higher rate.

Peter Bladen, managing director of BSOLAR said: “The High Court has ruled that the government’s decision to cut incentives by half was legally flawed because rates were cut before the consultation period was over. As a result we could see the government announcing another 90 day consultation period, and during this period the incentives going back up their original levels. So my advice to homeowners is be ready to install solar panels now and take advantage of this window of opportunity.”

The incentive scheme or Feed in Tariff, guaranteed homeowners 43p per kWh of energy they generate from solar panels. This rate is guaranteed for 25 years.

However the government cut this by half in December, with homeowners who installed panels after the 12 December only qualifying for a lower rate of 21p. These cuts led to thousands of organisations pulling out of solar energy schemes, and some of the biggest solar panel producers threatening to leave the UK.

Peter Bladen said: “Everyone was expecting the government to cut the feed in tariff rate, but this cut was supposed to happen in April 2012, by bringing the date forward, and cutting the rates with little notice, it has shaken the stability of the sustainable market."

He added: “With this new legal judgment I hope to see another consultation period put in place, however if the rates remain at the current lower level of 21 p for new installations, solar panels still represent a great investment for homeowners. With solar panel installations getting cheaper and cheaper, even on the lower rate a homeowner can still expect to make a £25,000 profit by installing solar panels on their roof."

The government is appealing against the High Court's decision today.