Assets not Liabilities Design Matters Economic Implosion Political Nightmare Solar Sunrise

Solar FIT To Bust #10

Part 1 : 29th November 2011
Part 2 : 1st December 2011

On Tuesday, Jeremy Leggett of the company SolarCentury alerted the Twitterati to the recording of the UK Parliament House of Commons joint committee meeting of the Environmental Audit Committee and the Energy and Climate Change Committee, so I snapped on over and took a gander.

I was treated to a marvel of confusion over numbers, figures and viewpoints. The spectacle of Greg Barker MP’s performance in committee was wildly entertaining, probably not the kind of effect he intended. He seemed to treat the discussion as an opportunity to keep insisting on his one precious ultimatum – to cut the solar photovoltaic feed in tariff subsidy in half, several months early, with only a few weeks’ warning, on 12th December 2011.

As I was taking in his presentation, I suddenly became aware that I’d seen something very similar to this before – a Minister seemingly somewhat jokingly pushing for something indefensible. I suddenly realised I was watching what could easily have been scripted as a scene in the film “In the Loop“.

Tom Hollander and Greg Barker – twins, separated at birth ?

On a more serious note, during the second part of the committee meeting, held today, 1st December 2011, Her Majesty’s Treasury admitted that the tax revenue from the solar feed-in tariff scheme equated to the level of funds made available; although there were questions about whether the FiT should be considered public spending or not; questions about whether the FiT would contribute overall to the Economy; and a total absence of concrete figures yet again.

But’s let’s go back and look at what the real problem is. The solar electric industry was given to understand that the full feed-in tariff would run until April 2012. Thousands of individiuals, communities and companies borrowed money and signed contracts on that basis – and companies had order books that were very healthy. Equipment was ordered and partly or fully paid for. Goods were in transit. Scaffolders, roofers, fitters, electricians and designers were all busy as bees in Spring, buzzing all over roofs, countrywide.

Everybody thought they had until April to get their solar installation done. Then, suddenly, they didn’t. They had less than two months. Panic on the streets of London, and everywhere else, too. It would be impossible to get everybody’s solar system up before the deadline.

So, the race to complete solar installations was on. The number of completions started to rise exponentially. And suddenly, the Department of Energy and Climate Change got the justification that they needed to confirm pulling the rug out from under the scheme. The very high levels of solar installations in the weeks preceding the full feed-in tariff cut-off date suddenly made it look very, very expensive.

Meanwhile, a number of people have had to be made redundant, many deposits have been withdrawn, and many people must be facing anxieties about whether they can pay back the money they have borrowed if they miss the FiT deadline.

Despite all the confusion, there is one fact that is clear – there will be vastly fewer solar photovoltaic installations in January 2012 than there were in November 2011.

Because of the long period from survey to completion, cutting the scheme short with six weeks notice effectively cut the heart out of the solar PV industry.

So that’s a bust, then.

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