Scottish roofing and solar specialist Forster Group has warned it is preparing to make job cuts following the government’s cut to Feed-in Tariff (FiT).
Currently Scotland’s largest commercial rooftop installer, Forster Group directly employs 43 people in its renewables business: Forster Energy.
Chief executive John Forster said it would have “no option” but to let a significant number of its directly employed staff go if planned cuts materialise, despite the size and diversity of its business.
“As [the cut] looms closer and closer, we are starting to have discussions at board level about the impact on the wider business, because it can only be significant,” he said.
A number of solar firms have entered administration or withdrawn from the UK solar market.
The Department of Energy & Climate Change’s consultation on the cuts closed last week.
The Solar Trade Association (STA) has estimated that more than 60,000 submissions were made.
According to the STA, 2,392 out of 2,990 solar jobs in Scotland could be lost as a result of the FiT cuts, making it one of the hardest hit UK regions.
Blow to communities
The sector was dealt another blow last week when the government’s Finance Bill scrapped tax relief for community energy programmes.
Community energy projects represent a significant amount of work for solar installers.
One company has told H&V News sister publication Construction News that up to 70% of its pipeline of work was at risk as a result of the change.
Mongoose Energy, which works with community groups and developers to help finance, build and manage community-owned renewable energy installations, said the changes in the bill could mean that £70m of planned or ongoing fundraising may not go ahead.
Community energy schemes have benefited in the past from being able to lock in FiT rates for 12 months, allowing time to secure investment.
Managing director Jan-Willem Bode said: “A lot of people made investments and business planning decisions based on the assumption that the FiT tariff for these projects would be eligible for the next 12 months after registering, and that the tax relief structure would stay in place as well.
“There’s now a serious risk that some of these projects will never get built, even though they’ve got registration on the FiT.”
Mr Bode added that a number of community groups had already scrapped fundraising activity for renewables schemes, describing the withdrawal of tax relief as an “emotional blow” to those groups, many of which are staffed by volunteers.
“They feel there’s no reason anymore to keep doing anything,” he said.
A Treasury spokesman said: “The government is committed to supporting the investment and innovation needed to achieve a cost-effective transition to a low-carbon economy, but we also want to do this in a way that is fair and provides value for money to hardworking taxpayers.
“We are aware of significantly increased interest in the use of subsidised community energy for low-risk tax planning purposes, which is why we have made changes to these schemes to ensure they remain effective at delivering investment to high-risk businesses that need funding to develop and grow, while protecting taxpayers from potential abuse.”