FiTs court claim swells to £140m
The group claims that “poor policy handling and illegal early cuts” led to a sudden slump in orders, cuts to profit margins, contract cancellations, damage to confidence, a surplus of inventory and thousands of redundancies.
All 17 individual claims are being consolidated by the High Court into a single claim against the Department of Energy and Climate Change. The case began as a £2.2m claim from three firms in July 2012, but has since ballooned.
Earlier this month it emerged that major contractor Breyer Group had become the most high-profile company to become embroiled in the row with DECC.
The average size of the claims is £6m, with the individual firms’ claims ranging from £250,000 to tens of millions.
The FiT subsidy was introduced in 2010 to encourage uptake of small-scale solar photovoltaic industry installations. It is designed to decrease steadily over time as production of the panels becomes cheaper.
However, when the FiTs were unexpectedly cut in December 2011, a judicial review found that DECC had acted unlawfully.
The group of companies called the handling of FiTs “a major setback removing any opportunity to invest in jobs, training, new technology development, domestic and even overseas market expansion”.
In response to the claim, Labour shadow energy and climate change secretary Caroline Flint called for ministers to “come clean about why they pushed ahead with their unlawful plans and what legal advice they got in the first place”.
She added: “Thousands of people lost their jobs, many businesses in the solar industry saw their order books dry up and the number of people installing solar panels slumped.”
The claim is led by energy law firm Prospect Law, which handled the earlier judicial review.
E-tricity chief executive Simon Gillett said the industry had been treated “very badly”.
“Last year should have been our year for growth, innovation, investment and training, but instead it was an ‘annus horribilis’ peppered with cutbacks, customer confusion, part-time working, stress and redundancies,” he said.
“We had to let 30 per cent of our staff go. So we are calling for compensation after this illegal action to help us get up to speed again and help secure the clean and affordable energy supply we need.”
In 2011 the Environmental Audit Committee and Energy and Climate Change Committee slammed the government’s handling of FiTs as “panicky”, warning that its behaviour “undermines confidence”.
A DECC spokesman told CN the department wouldn’t be commenting on the details of individual cases. He said the department didn’t accept it had any liability, adding that “we will vigorously defend our position”.
Solar is currently the third largest source of renewable energy in the UK, and DECC plans to increase capacity from 1.4 GW to 20 GW by 2020.
The 17 companies behind the claim include solar installers, free solar companies and housing associations
- Solar Power PV
- Solarlec
- Crystal Windows and Doors
- Breyer Group
- Freetricity
- E-tricity
- Foz Electrical
- Green Home
- CI Installations
- Viscount Solar
- Vsolar
- House Choice
- Evo Energy
- Solar Panels Direct
- Monitor My Solar
- Apollo Energy
- Cleaner Air Solutions