December 2, 2009 11:45 pm

Solar industry ‘in limbo’ as grants dry up

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Renewable energy manufacturers have warned of their “frustration” after the government’s flagship grant scheme for solar power ran out of money less than halfway through the financial year.

The UK PV Association, which represents companies making and installing solar panels, warned that they were “in limbo” after the Low Carbon Building Programme Phase 2 was closed to solar applications this week.

The £50m ($83m) scheme had included up to £18m for hospitals, schools and other public sector buildings to instal photovoltaic panels on their roofs. But it has been closed down “due to unprecedented demand”.

Meanwhile, an announcement has been delayed on a clean energy cashback scheme – called “feed-in tariffs” – which will let people sell renewable power back to the grid. The industry had expected the decision this month but now believes it has been delayed amid wrangling between the energy department and the Treasury.

“This leaves installation companies in limbo land, unable to plan their businesses and unsure of what advice to give customers,” said the association.

Andrew Lee from Sharp UK, which employs 600 staff making solar panels in Wrexham, said the industry would have to endure another “unnecessary hiatus in support”.

The news is awkward for the government, coming just days before international climate change talks open in Copenhagen. Britain gets less energy from renewables than almost any other EU country.

Green campaigners have complained about the way ministers have launched a succession of “piecemeal” renewable energy grants.

“Our members face ongoing uncertainties and yet another round of stop-start support,” said Ray Noble from the Renewable Energy Association.

This week the energy department announced it was closing the scheme to companies and public sector applicants – although Phase 1, which applies to households, is still open. The energy department is also still offering grants for large-scale wind, hydro and biomass projects but has introduced a waiting list.

Dave Sowden, chief executive of the Micropower Council, said the removal of the grants would put green jobs in jeopardy and undermine Britain’s credibility ahead of Copenhagen.

A spokeswoman for the energy department said feed-in tariffs were on track to begin next April. “It’s very encouraging that there’s been an unprecedented demand for this technology but we have to be fair to all renewable technologies,” she said.

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