ENERGY Secretary Chris Huhne insisted yesterday the UK Government was forced to slash popular solar electricity subsidies to stop domestic bills rocketing.
But one north-east solar installation firm said the decision had forced it to shelve its expansion plans.
Liberal Democrat Mr Huhne was unable to tell MPs just how much electricity customers would have had to pay extra if the scheme had continued at its current rate.
He insisted cutting the level of feed-in tariffs (FITs), which pay people for the electricity they generate from small-scale renewables, was needed to avoid “boom and bust” in the system. Installations of solar photovoltaic panels have outstripped expectations and the subsidies are funded from consumer bills.
Last year his department predicted the average impact was £6 on each domestic household bill. The change to FITs has also sparked claims from industry leaders that the large-scale cuts could seriously damage the sector and the thousands of jobs it now provides.
Kintore-based Solar Scotia had been due to hire two extra employees and move into a new headquarters at Inverurie until the proposed changes to the FITs scheme emerged.
The programme pays people for the electricity they generate from solar panels, but the government this week launched a consultation on revised subsidies for systems installed after December 12, as well as a requirement from April next year for households to reach a level of energy efficiency to qualify.
Solar Scotia technical manager Tristan Wolfe said: “Obviously it came as somewhat of a surprise. We knew there would be a reduction in tariff, but it was going to be April next year. We’ve had to cancel a number of jobs we had scheduled in. Customers have said they are not willing to go ahead at that price.”
Mr Wolfe said that suppliers had raised their prices in the wake of the government’s announcement, and that the firm had now brought forward jobs and were working seven days a week before the new deadline in December.
In total, almost 500 systems have been installed in the north and north-east under the scheme, including 198 in Aberdeenshire, 39 in Aberdeen, 56 in Moray and 171 in the Highlands.
Mr Huhne also criticised householders who had put up solar panelling before carrying out basic energy-saving measures to their homes.