FiT damages claim grows to £140m

high court feature
17 British solar and construction companies have come together to call on the government to pay damages for lost business incurred after its unlawful changes to the Feed-in Tariff.

The group has asked for £140m from the Department of Energy and Climate Change (DECC) following its handling of the policy change which led to a drop in installation rates and redundancies in the sector. The policy shambles began in 2011 with the government imposing a date for a cut to the Feed-in Tariff which fell before the end of the initial consultation – a move which was ruled illegal by the High Court and upheld by the Supreme Court in spring 2012.

Organisations claiming damages include Solarlec, Crystal Windows and Doors, Viscount Solar, Evo Energy and Cleaner Air Solutions whilst claims range from £250,000 to tens of millions.

The claim is being led by Prospect Law – the energy law firm which previously defeated the government over the cuts. An initial claim for £2.2m was made by three firms in July last year which has since grown, reflecting the anger felt in the sector and damage felt by the events of 2011 and 2012.

Simon Gillett, chief executive of E-tricity, one of the claimants, said: “The good news is that solar is now once again a sound investment. The Feed-in tariff is secure, solar prices are falling and both the government and public now want solar to play a big role in our energy mix. 

“But the industry was treated very badly, and companies must be healthy and ready to work to meet demand. Last year should have been our year for growth, innovation, investment and training, but instead it was an ‘annus horriblus’ peppered with cut backs, customer confusion, part time working, stress and redundancies. 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. We’ve just about made it through and our focus is now on investing in a much diminished workforce and planning for the future.”

Caroline Flint, Labour’s shadow energy and climate change secretary, added: “For months Labour warned that the government’s cuts to the feed-in tariff for solar power went too far and too fast. 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. Ministers must come clean about why they pushed ahead with their unlawful plans and what legal advice they got in the first place.

“At a time when pensioners have seen their winter fuel payments cut, the number of people getting help with insulation has plummeted, and millions of families are struggling with their energy bills, the Government must ensure hard-pressed taxpayers aren’t left to foot the bill for its incompetence.”