DECC announce plans to adjust FiT levels upon outcome of High Court Ruling
DECC have announced today plans to adjust FiT levels as a contingency in relation to the outcome of the High Court Appeal. In summary, should the Government appeal be upheld, DECC will uphold the pre- Christmas Phase 1 consultation proposals, subject to Ministerial approval, of tariff levels being reduced for installations post 12th December 2011. However, should the Government appeal be rejected, DECC have today announced a contingency plan whereby FIT installations with an eligibility date on or after 3 March 2012 will receive the lower tariffs proposed in the Phase I consultation document.
It is clear that the reason for this latest proposal is due to Government concerns that should their appeal be unsuccessful, there would be a rush of installations between the High Court announcement and 31st March, putting further pressure on the FiT budget and potentially resulting in further reductions in tariff levels across all technologies post March 2012. By bringing a change to tariff levels forward to 3rd March, the Government have effectively reduced the time between the High Court ruling and the FiT reduction to minimise the impact of any rush to install PV technologies deployed in order to maximise higher tariff levels.
A statement from Ministers said "We continue to stand by our original proposal. However, I know that the uncertainty while we await the Court's decision is difficult for the industry. A retention of the 43p tariff could also create substantial risks to the FITs budget if our appeal is unsuccessful. For these reasons, we believe it is prudent to bring forward our decision on one aspect of the consultation: the proposals for new solar PV tariffs.
We are therefore laying before Parliament today some draft licence modifications which, subject to the Parliamentary process set out in the Energy Act 2008, makes provision for a reduced tariff rate (from 1 April 2012 onwards) for new PV installations with an eligibility date on or after 3 March 2012"
DECC have also issued a FiT contingency plan Q&A sheet which can be found here.