At least three apparently.
What an utter waste of time and taxpayer’s money. We don’t really have much sympathy with Homesun or SolarCentury who lodged the legal action in the first place, although we appreciate that they are desperate to preserve the ‘rent-a-roof’ model; all this process is doing is prolonging uncertainty.
But the fault for all this lies squarely at DECC’s door. There’s no doubt that at 43.3p the FIT had become over-generous given component price reductions and huge competition amongst installation companies. A FIT of 21p still gives a handsome return given the current investment backdrop. The problem has been all the misinformation and mishandling by DECC, quite apart from the flagrant disregard for due process (their own process, to boot).
Conclusion: should any of us in business ever by surprised that an unholy alliance of elected politicians advised by civil servants should completely disregard the basic requirements for creating a favourable business environment? Not really. Just ask the farmers, they’ve had decades of it.
Misinformation? Yes, figures that DECC put about to justify the precipitous cut announced in late October varied wildly and didn’t stand up to scrutiny. One figure quoted was that the cost of FITs would add c.£70 to household energy bills annually by 2015; another figure given was closer to £2. Another justification cited for the drop was that component prices had come down by 50% since the FITs started – what utter rubbish. There had indeed been an approximate 30% reduction in prices over a 3 year period, but the end cost to the customer was closer to 50% lower due to the intense competition between accredited installers. There were just under 300 MCS accredited PV installation companies in August 2010, compared to over 3,000 a year later. You don’t need Evan Davies or Robert Peston to explain the impact on prices of an increase on the supply side, but clearly this fact conveniently escaped the spinners at DECC.
Of course, the FIT regime was not sustainable. At 21p it will be. But customers and the remaining installation companies need some certainty, with a clear roadmap of tariff digression over at least the next 5 years. Is that too much too ask?
And don’t get me started on EPCs…