UK government loses FiT appeal

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  The Department of Energy and Climate Change has lost its appeal against a High Court ruling that deemed its handling of the FiT scheme as ‘legally flawed’.

The Court of Appeal has today upheld a High Court ruling that the Department of Energy and Climate Change (DECC) acted illegally over planned cuts to Britain’s feed-in tariff.  After deliberating over the decision for 10 days, three Court of Appeal judges ruled that DECC’s proposals would have constituted retrospective changes to feed-in tariff contracts and are therefore unlawful, reports Solar Power Portal.

The judgement means that feed-in tariff rates for all solar PV systems registered on or after December 12, 2011, will return to previous levels until March 3, 2012, – the date at which proposals laid before parliament, which reduce the feed-in tariff, will come into effect.

Daniel Green, CEO of HomeSun, one of the companies behind the legal case, said, “Four judges, including three in the Court of Appeal, have now called government’s actions illegal. That’s a four-nil victory and a decisive ruling that government may not make retrospective changes to the FiT because, as Lord Justice Moses concludes, to do so ‘would be to take away an existing entitlement without statutory authority’.

“Both this appeal and the Judicial Review in The High Court would not have been required had DECC simply followed its own process and allowed the industry, that it claims to support, time to prepare for a lower feed-in tariff,” explained Green.

However, the decision still leaves the UK solar industry under a cloud of uncertainty, as the government has signalled its intention to continue its challenge at the Supreme Court.

Reacting to the news, Energy and Climate Change Secretary, Chris Huhne said, "The Court of Appeal has upheld the High Court ruling on FiTs albeit on different grounds. We disagree and are seeking permission to appeal to the Supreme Court.

“We have already put before Parliament changes to the regulations that will bring a 21p rate into effect from April for solar PV installations from March 3 to help reduce the pressure on the budget and provide as much certainty as we can for consumers and industry.

“We want to maximise the number of installations that are possible within the available budget rather than use available money to pay a higher tariff to half the number of installations. Solar PV can have strong and vibrant future in UK and we want a lasting FiTs scheme to support that future and jobs in the industry.”

The government’s intention to challenge the ruling in the Supreme Court will mean that solar PV installers in Britain will not be able to guarantee the higher FiT rate of 43.3p until the Supreme Court makes a ruling. Such a decision is unlikely to be forthcoming until after the proposed March 3 reference date.