Solar firms seek £2.2m damages over FIT cut
A group of solar firms have launched a £2.2 million claim for damages as a result of the government’s illegal cut to the feed-in tariff last November.
Three solar companies have written to the Department of Energy and Climate Change demanding compensation for loss of earnings – threatening High Court action if it is not received.
Their claim comes after a High Court ruling in January that DECC‘s earlier than expected cutting of the FIT from 43.3p per kilowatt hour to 21p/kWh with just six weeks warning was ‘unlawful and unfair’.
DECC lost an appeal in the Court of Appeal, and the Supreme Court also then rejected their appeal of the ruling.
Many solar schemes – including social housing projects – were abandoned or put on hold in the wake of the cuts because they were no longer viable.
The three firms are arguing that the premature cuts to the FIT, which is a subsidy paid to producers of renewable electricity, caused a loss of business which hit their profits.
Two of the three companies wish to remain anonymous. However, one, Burnley-based installer Solarlec, which is the largest individual claimant, said it hoped that the claim would not go as far as the High Court.
Asked why the companies are taking action so long after the original legal battle ended, Nick Keighly, founding director at Solarlec, said: ‘We had to see how things had progressed and analyse what the impact on our business actually was. The losses are very real. We are just giving the government the opportunity to compensate us.’
Mr Keighly added that he believed the three firms had a ‘very strong case’ and confirmed other firms had expressed an interest in joining their claim if it goes to the High Court.
It is understood that DECC has two weeks to respond to the letter sent on behalf of the three claimants by law firm Prospect Law, which represented Solar Century in its successful High Court challenge to the FITs cut.
A spokesperson from DECC said: ‘We can confirm we have received a letter before action on FITs and we are considering its content.’