Government set to cut solar power subsidies

The government have announced that renewable energy subsidies are to be axed for smaller solar power farms.

The government has outlined plans to cut subsidies to the renewable energy sector citing spiralling costs and the need to reduce energy bill for domestic and business consumers.

The Department of Energy and Climate Change is launching a consultation that would end subsidies for new solar farms under 25 acres in size by April 2016.

Energy and Climate Change Secretary Amber Rudd said: “My priorities are clear. We need to keep bills as low as possible for hardworking families and businesses while reducing our emissions in the most cost-effective way.

“Our support has driven down the cost of renewable energy significantly. As costs continue to fall it becomes easier for parts of the renewables industry to survive without subsidies. We’re taking action to protect consumers, whilst protecting existing investment.

“We can’t have a situation where industry has a blank cheque, and that cheque is paid for by people’s bills.”

Scrapping the financial support for the smaller scale projects would see a reduction in cost of solar subsidies to bills, which stands at £3 per household.

The move has been criticised by supporters of the renewables obligation and green campaigners who claim that the subsidies represent the most cost effective way for the government to fulfil its climate change targets.

Solar Trade Association board member, Jonathan Selwyn, expects the move to have repercussions on the industry: “Let’s get this straight, in the renewables obligation, which is the solar farm’s main support subsidy, it’s costing about three pounds per annum on people’s energy bills – it’s a tiny amount when you compare it with other types of energy, like nuclear for example.”

Mr. Selwyn said that the industry was very close to being able to operate without subsidies and that government support had been key to getting the industry to the position it is in today. He also expects investor confidence to be hit following this decision.

Green Party MP, Caroline Lucas, said: “This proposed cut to support for solar is utterly short-sighted.

“While the Government continues to subsidise fossil fuels and nuclear, it’s undermining investor confidence in clean, renewable energy generation. This cut would further undermine Britain’s commitment to meeting our climate change targets and deepen our addiction to dirty fossil fuels.”

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