The Department of Energy and Climate Change (DECC) has suffered its second court defeat in the ongoing dispute over plans to retrospectively cut the level of feed-in tariff (FiT) subsidy for solar PV installations.
Although Energy Secretary Chris Huhne is vowing to take the matter all the way to the Supreme Court, even if that appeal is allowed, there can be no question that this is a body blow to the DECC's hopes of succeeding with its proposals.
After its defeat in the High Court in late 2011, this latest decision from the Court of Appeal might put the lights out on the plans, which were to reduce solar PV FITS on any installations completed after 12 December 2011. The DECC has already put draft legislation before Parliament to reduce FiTs for installations commissioned and registered after 1 April 2012, and was seeking to backdate those cuts in order to prevent some home owners from making disproportionate profits from FiTs. The Court of Appeal has agreed with the High Court that the DECC has not got the legal powers to do that in the circumstances.
As matters stand after the Court of Appeal ruling, any solar PV installations commissioned and registered between 12 December 2011 and 3 March 2012 will qualify for a FiT of 43 pence, index-linked for 25 years. This compares extremely favourably with the 21 pence FiT which the DECC is proposing, and which will be the FiT for solar PV commissioned and registered from 1 April 2012.
It remains to be seen if this latest victory will result in a "solar flare" of home owners rushing to install solar panels before the end of March, in order to take advantage of the favourable FiT rate.
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