Press release

Government has no real chance of winning an appeal over lost solar court case

22 December 2011

The Government must drop plans to appeal over its lost high court solar battle or jeopardise thousands of jobs and land the taxpayer with a legal bill of tens of thousands of pounds, Friends of the Earth said today.

A judge ruled yesterday that the Government's plans to rush through cuts to solar payments were illegal - and refused permission for an appeal because it had no real prospect of winning - following a legal challenge by Friends of the Earth and two solar firms - Solarcentury and HomeSun.

The court pronounced that proposals to cut feed-in tariff payments for any solar scheme completed after 12 December - 11 days before the official consultation closed - were unlawful.

Instead of going through a costly and fruitless further appeal process, Friends of the Earth is calling on the Government to create a new plan for solar payments to fall in line with reduced installation costs, ending uncertainty among solar companies and workers facing redundancy.

New analysis by the environmental campaigning charity shows that the overall budget to the feed-in tariff scheme could be increased to allow more people - including poorer households and community groups - to benefit without any additional cost to energy bill payers because of the tax revenue the scheme generates.

Friends of the Earth's Executive Director Andy Atkins said:

"The Government's reckless and illegal plans mean that thousands of solar workers are facing redundancy in the run up to Christmas.

"Instead of digging their heels in with a pointless and expensive legal appeal, Ministers must clear up this mess and help create a stable solar industry so that more people can benefit from free, clean energy.

"Solar payments should be cut in line with falling installation costs but the scheme can be expanded at no extra cost to bill payers, saving thousands of jobs."

ENDS

Notes to editors:

1. A full transcript of the court proceedings will soon be available from Friends of the Earth's press office - 0207 566 1649

Photographs of Friends of the Earth's action outside the High Court last week are available, for free at:
http://www.flickr.com/photos/wwwfoecouk/sets/72157628428618941/

2. On Monday 31 October 2011 the Government launched a public consultation that would see the amount of solar panels installed each year fall by between 50 and 95 per cent: http://www.decc.gov.uk/en/content/cms/news/pn11_091/pn11_091.aspx

3. The Government's proposals have already had a devastating impact. Countless planned clean energy schemes have been abandoned and thousands of jobs are under threat. Last month a report by Element Energy, commissioned by Friends of the Earth and the solar industry, showed that the premature cuts could threaten 29,000 jobs and lose the Treasury up to £230 million a year in tax income. It showed that additional costs to lift the cap off the scheme will be more than equalled by extra tax receipts to the exchequer and saving on unemployment benefit that would have been paid to sacked solar fitters. www.foe.co.uk/resource/briefing_notes/element_energy_summary.pdf. Earlier this month construction firm Carillion warned 4,500 workers their jobs are at risk because of the Government's proposals.

4. Calculations by Friends of the Earth and Element Energy suggest that the Treasury receives from the solar industry at least £330m per year in income taxes, corporation tax, and VAT. Friends of the Earth's calculations also reveal that any additional costs over budget that result from restoring the cut-off date to April, as well as allowing for moderate growth in the solar industry over the next three years at lower tariff rates, could be paid for by using this tax income - not increasing the costs to consumers.

5. The Government's decision to slash solar funding was described by the CBI as an 'own goal' last month (Thursday 10 November 2011): http://www.cbi.org.uk/media-centre/speeches/2011/11/john-cridlands-speech-to-cbi-east-midlands-annual-dinner/

6. Friends of the Earth is calling on the Government to:
• Establish a system which enables feed-in tariff support to fall in line with the falling cost of solar technology - but in a stable fashion that supports the continued growth of the industry and jobs.
• Increase the overall budget for feed-in tariff schemes using tax revenues generated by jobs created by the scheme.
• Exclude housing association, school, council and other community projects from the damaging proposal to give multi-building projects even lower financial support.
• Only require solar projects on homes to install loft and cavity wall insulation where possible - rather than imposing much tougher energy efficiency conditions which would make 9 out of 10 householders ineligible for the scheme.

7. Examples of solar energy projects that have either been scrapped or are in jeopardy are available from Friends of the Earth's press office - please call 020 7566 1649/ 07712 843 209 for more information.

8. The feed-in tariff scheme has led to the installation of more than 100,000 solar panel projects since its introduction in April 2010 and created around 27,000 new jobs, the majority of which are now under threat.

9. Friends of the Earth's legal challenge to cuts in solar incentives is part of its Final Demand campaign, which calls for energy we can all afford and a public inquiry into the power and influence of the Big Six energy companies. Find out more at www.foe.co.uk/finaldemand.

10. Almost 20,000 people have asked the Government to keep supporting clean British energy - join them now at www.foe.co.uk/finaldemand.

11. More than 200 organisations, including community groups, councils, business organisations, solar companies and NGOs have signed a statement calling on the Government to re-think its plans. http://www.foe.co.uk/resource/briefing_notes/fd_joint_statement1.pdf

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Published by Friends of the Earth Trust