Press release

Government slashes solar electricity funding

9 June 2011

Cuts to the funding of solar electricity schemes announced by the Government today (Thursday 9 June 2011) are likely to have a devastating impact on community green electricity projects and small businesses, warns Friends of the Earth.

Today's announcement will see a reduction in feed-in tariff payments made to solar electricity schemes above 50kW - equivalent to solar panels for around 15 homes. It follows Treasury concerns about the funding of green energy schemes.

Feed-in tariffs, which were introduced last year following a successful campaign led by Friends of the Earth and the Renewable Energy Association, provide guaranteed long-term payments for small scale green electricity generation.

The green campaigning charity is warning that reduced payments are likely to lead to a reduction in the development of community-owned green energy schemes and undermine the solar industry's potential to create tens of thousands of new jobs. Since the Government announced its intention to review the funding of solar electricity projects earlier this year:

• Numerous planned solar energy projects - including community schemes - have been put on hold by investors fearful of the outcome of the review. The Government committed to supporting community projects in the Coalition Agreement last year.
• Solar manufacturing and installation firms have seen a reduction in demand, which has hit plans to create thousands of new UK jobs in the sector.

Friends of the Earth's green energy campaigner Donna Hume said:

"This consultation has been an utter farce - Ministers have completely ignored warnings from community groups and investors about the devastating impact of slashing payments.

"With mounting concern about the rising price of fossil fuels and the impact of global climate change the Government should be increasing financial support for clean, green energy - not cutting it.

"Germany has given proper funding to its solar industry and consequently fuel bills there are falling - but the UK  is saddled with shrinking green ambition and soaring fuel bills.

"Our schools, businesses and housing estates could become mini-power stations so we all play our part in the renewable energy revolution - but yet again the Treasury has stamped on the green shoots of a low-carbon future."

ENDS

Notes to editors:

1.   Feed-in tariffs were introduced last year. The funding scheme provides guaranteed long-term payments for small scale green electricity generation for a range of renewable electricity technologies up to 5MW in size (equivalent to around two wind turbines).

But Ministers say the scheme has encouraged too many commercial solar farms - and launched a consultation earlier this year on plans to cut payments to solar electricity projects over 50kW in size.

 2.   A more comprehensive review of the feed-in tariff scheme is due to be announced shortly.

 3.   More information on feed in tariffs: http://www.foe.co.uk/resource/briefings/fit_review.pdf

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Published by Friends of the Earth Trust