It is hardly surprising, but that does not stop it being shocking. The government has confirmed today that, as proposed, it will impose deep cuts to the feed-in tariff incentives available for large solar installations of between 40 and 70 per cent, making future installations with over 50kW of capacity instantly untenable.
Hopes of a last minute reprieve for at least some mid-sized building-integrated projects have been dashed, leaving a large chunk of the UK's emerging solar industry in the doldrums.
The arguments over the rights and wrongs of the government's decision to impose an early review of incentives on large solar installations are well known to anyone who has followed this sorry saga, and will now be raked over again in court after a High Court judge ruled that disgruntled solar developers could proceed with their Judicial Review against the decision.
The government maintains that the feed-in tariff scheme was overheating as a result of the rush to develop solar farms, and that deep cuts were vital to ensure that the incentives did not run out for smaller domestic installations.
The industry counters that the government breached its own processes in announcing the early review, failed to consider the views of the 81 per cent of respondents to the consultation that said the cuts were too deep, and has now pulled the rug from under a promising industry at a time when other nations are investing heavily in the deployment of increasingly cost-effective solar technologies.
It is now for a learned judge to decide who is in the right, but the more pertinent question is why government and industry singularly failed to reach a compromise that would have allowed at least some larger solar projects to go ahead without breaking the feed-in tariff budget?
The inability to develop some kind of compromise represents a remarkable failure of ministerial imagination. I completely accept the government's contention that falling solar panel prices meant that solar farm developers were in line for inflated returns that needed reining in. But I refuse to believe it was impossible to develop a new regime that provided sustainable support for large and small projects alike.
It should have been possible to develop a system where reasonable levels of support for domestic installations are maintained, while a number of large rooftop and solar farm installations receive incentives that deliver the five to eight per cent rate of return that was originally promised. These more modest rates of return would be unlikely to attract the venture capital investors that were in danger of overheating the scheme, but would surely still allow ethical investors, green businesses and community projects to continue to invest. As such, the UK would be able to continue to develop a more balanced solar sector where domestic installations encourage public engagement with renewable energy, while the economies of scale realised by larger solar installations help to drive down the cost of solar energy.
If ministers felt it necessary, a clearly stated cap on the amount of money available to mid-sized and large solar projects would have provided further assurances that the scheme could not overheat, while ensuring that at least some projects get built. Instead, cuts of between 40 and 70 per cent have killed all projects with over 50kW of capacity stone dead for at least a few years.
At a time when other parts of Europe are planning to deliver solar power at the same cost as fossil fuels within five years, the UK is killing off the market that would bring down costs fastest. Moreover, I know of at least one company operating in this space that was so enraged by this morning's decision that it is talking about shifting operations and jobs to Europe.
Climate Minister Greg Barker is making all the right noises about the continued development of the domestic solar market and his desire to deliver sustainable and affordable growth across the whole sector.
But he has to accept that the government has badly mishandled this fast track review from beginning to end (were the rumours about the review mistakenly including projects with 50kW rather than 500kW of capacity true?) and has singularly failed to deliver an effective incentive regime that would allow all areas of the solar market to continue to prosper, albeit at a slightly slower pace.
However, the solar industry also needs to take a long hard look at itself and ask why it failed to convince ministers of the merits of more modest cuts to feed-in tariffs.
The reason the government was able to ignore the fact that 81 per cent of respondents to its consultation thought the cuts to incentives inappropriate is that the industry failed to put together a coherent alternative that commanded wide support.
Whether by luck or judgement, DECC was able to divide and conquer the solar industry's many factions. Domestic solar installers greeted the deep cuts to large projects, mid-sized developers accepted the cuts to larger projects but called for their own installations to be protected, some large developers argued for more modest cuts, others raged against any cuts, and a small band of companies opted to launch legal action against Chris Huhne. Meanwhile, the government was left to simply proceed with its original plans, insisting no one had presented a sufficiently popular alternative.
Each group undoubtedly took up a rational position in an attempt to protect their own interests, but the failure to offer ministers a viable Plan B meant that they were always likely to stick with Plan A, despite its many flaws.
The only option for the industry now is to try to draw a line under the whole affair and move forward. The Judicial Review may still deliver a curve ball and force the government to rethink, but it is unlikely to be anything more than a short-term victory. Governments do not take kindly to being dragged through the courts, and the history of Judicial Reviews is one of high-profile victories followed by the government tweaking its plans and proceeding pretty much as originally intended.
Instead, the solar industry must look to heal some of its internal rifts and take Barker up on his offer of meetings on how to ensure that the sector continues to grow through next year's full review of feed-in tariffs and beyond. The government has delivered a shocking blow to the solar sector, but it is now up to the industry to ensure it is not a fatal one.
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