The British High Court has ruled in favour of 14 solar and construction companies, who claimed damages against the Government because of its unlawful changes to the Feed-in-Tariff (FiT) in 2011. The damage awarded will be decided in the next months, but the group are suing for £ 132 million as compensation.
The British companies issued the claim in 2012, after Energy Minister Greg Barker had announced retrospective cuts to the FiT in October 2011. The changes in the FiT caused damages to the photovoltaics market. Therefore the group is seeking for overall £ 132 million as compensation from the Department of Energy and Climate Change (DECC).
In 2011 and 2012 especially social housing projects, where solar installations should have prevented a rise in energy costs, were afflicted by the FiT-cuts. Estimations are that the industry had shrunken until May 2012 by 25 % and that 6,000 people had lost their jobs in the field as a direct result of the FiT-cuts. Even the Government’s Environmental Audit Committee and the Energy and Climate Change Committee labelled the cuts as “panicky” and said that they “undermine confidence”. Luckily, the photovoltaics industry recovered from the shock, after another High Court case was settled in 2012 and a stable Feed-in-Tariff was secured.
Nick Keighley of Solarlec, one of the claimants firms, summarised the intentions of the claimant firms: “If the Government really does support solar, it needs to compensate businesses for the losses it caused and move forward with the industry.”
The claim is being led by Prospect Law who already defeated the Government over the cuts in 2012. The height of the claim still has to be decided, but the companies want £ 132 million as compensation. This value reflects the extent of commercial damage by the FiT-cuts due to a loss of confidence in customers, less opportunities to invest in jobs and new developments. The exact damages awarded will be decided depending on the value of the firm’s contracts, which were affected by the Government’s decision. After a submission to the courts by Prospect Law, this decision will hopefully be reached in the following months.
Tanja Peschel
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