The Alliance of Sector Skills Councils

Legal challenge reflects concerns of employers

22 Dec 2011

The foundations of a growing solar PV industry have been seriously shaken by the decision to cut the Feed-in Tariff, SummitSkills has told Government in its feedback to the FiTs consultation, ending on 23 December.

The sector skills council for building services engineering has gathered views from companies and employers’ organisations about the effect of the Government cut in the financial support designed to encourage take-up of solar photovoltaic technology.
 
SummitSkills has also noted the outcome of a legal challenge by Friends of the Earth and two solar PV companies, which found that there was a case for the Government to answer in prematurely reducing the tariffs on 12 December, before the end of its own consultation period. These conclusions reflect SummitSkills’ findings, showing that the building services engineering sector has been particularly hard hit by recession but that the solar PV market was providing employers with a very welcome area for growth, thanks to the Government’s Feed-in Tariffs. Many employers had invested in training to take advantage of this opportunity, employing extra staff in order to meet growing consumer demand for solar panels. Now, according to employers, the cuts to the Feed-in Tariffs are already smothering the fragile market. Staff who had been laid off, but then retrained to meet demand for solar PV, are once again facing an uncertain future. 
 
Chief executive of SummitSkills, Keith Marshall OBE, said: “We understand the argument that Feed-in Tariffs need to be sustainable, and it is clear that this mechanism has played a significant role in stimulating demand and creating much-needed growth. However, the emerging solar PV market is still fragile and its long-term viability depends on managing supply and demand sensitively. These cuts to the FiTs were implemented without adequate warning, not allowing the Government time to work with the companies and organisations whose input could have enabled it to find a workable compromise. The Government’s action will inevitably make employers, consumers and businesses think twice before embracing environmental technologies in the way that the Government needs them to - if the UK is to meet its challenging carbon emission reductions targets.“
 
SummitSkills’ feedback to the Government’s FiTs consultation from the BSE sector focuses on:
  • the Feed-in Tariff for levels above 10kw are unlikely to be enough to encourage investment;
  •  there was not enough notice of the Government’s intention to revise the FiT – industry should have had time to negotiate a workable compromise;
  • the solar PV industry is just getting established and the change to FiTs has effectively pulled the rug out from under it;
  • employers say they are now facing stark choices about the future of their workforce as demand decreases;
  • confidence amongst employers has been severely bruised by the Government’s actions.

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