By Gemma Childe on 21st May 2012
The solar industry has been buoyed by news that the Government is planning to delay the next round of cuts to feed-in tariffs.
Since last year's "solar rush", the industry has been facing more challenging conditions, caused in part by cuts to state subsidies, but also by falling consumer confidence and the return to recession.
The latest consultation on possible cuts to the current 21p per kw/h feed-in tariff for household solar installations was due to result in new rates from July 1.
But Greg Barker, the climate change minister, has now confirmed rumours that the cut is likely to be delayed.
"Having listened carefully to industry, we are looking at scope for pushing back a little the next proposed reduction in solar feed-in tariffs," he posted on Twitter.
The Department of Energy and Climate Change said that an official announcement on the delay would be published shortly, along with the results of the feed-in tariff consultation.
The DECC could not confirm the exact timescale of the delay, but industry sources suggested that cuts would come into effect on August 1.
In the Commons, Ed Davey, the Energy Secretary, said he was looking at "a tweak not a massive change". He added that a FiT rate of 21p worked, saying that “the message must go out that the UK solar industry is back in business.”
The Government re-think will provide a boost to the solar industry after recent PV installation figures showed that demand had decreased from a four-weekly average of 71MW over the past 12 months to just 17MW.
“We are facing an unusual set of challenges right now and it is fundamentally a problem of confidence and perception,” said Alan Aldridge, the chairman of the Solar Trade Association.
"We need all champions of solar – in Government, industry and elsewhere – to help us get the message out that solar is still a great investment, particularly with energy bills on the rise again."
Leonie Greene, the head of external affairs at the Renewable Energy Association, added: “We’ve been making a case for a delay to the July cuts for a couple of weeks now, so we’re very pleased DECC has been listening to industry. Hopefully this will give industry a chance to kick-start the market.”