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High court rules that FiT cuts were 'legally flawed'

Solar firms and the charity Friends of the Earth today won their legal challenge against the government’s plans to cut Feed-in Tariff payments to solar schemes started after the 12 December 2011.

The High Court ruled that the government’s plans to cut solar tariff payments 11 days before the official consultation on the subject closed was unlawful, following the legal challenge by Friends of the earth and two solar firms Solarcentury and HomeSun.

Friends of the Earth executive director Andy Atkins said: “These botched and illegal plans have cast a huge shadow over the solar industry, jeopardising thousands of jobs.

“We hope this ruling will prevent ministers rushing though damaging changes to clean energy subsidies - giving solar firms a much-needed confidence boost.

“Solar payments should fall in line with falling installation costs but the speed of the government’s proposals threatened to devastate the entire industry,” said Mr Atkins.

The government has been given the right to lodge an appeal by 4 January.

The decision to halve the Feed-in Tariff rate has caused outcry in the industry; last month the CBI called the move the “latest in a string of government own goals”, while yesterday a survey from the Electrical Contractors’ Association revealed that nearly 90 per cent of contractors believed the proposal would lead to a major fall in consumer demand for solar panel work.

Carillion Energy Services has already said 1,500 jobs will be axed as a direct result of the government’s decision.

A report commissioned by Friends of the Earth and Cut Don’t Kill - a solar firm, consumer and environmental group alliance - released in November - showed the cuts could cost up to 29,000 jobs and lose the Treasury up to £230 million a year in tax income.

A reduced rate of 21p/kWh for solar PV installations of less than 4 kW will be introduced from 1 April 2012 and will affect all installations on or after 12 December 2011.