The Government has received cautious support from energy leaders after announcing a wave of changes to controversial solar subsidies, which will include further slashes to the renewables incentive scheme.

Energy minister Greg Barker confirmed it will press ahead with a controversial move to halve the Feed-in Tariff (FiT) payments for panels installed from March and has telegraphed further cuts from July – despite planned increases to the fund being made available.

The tariff has been the catalyst for a much-heralded but short-lived solar boom in the South West, where unrivalled levels of solar radiation made the region ripe for investment.

However, the successive cuts to the tariff – announced when DECC published the result of its consultation on the tariff changes – mean some schemes could get a paltry 13.6p tariff from July.

Shadow energy secretary Caroline Flint said the change could amount to a 70 per cent cut in the tariff subsidy in just six months, during an urgent question session at the House of Commons yesterday.

But Mr Barker told MPs he was giving the scheme "plenty of TLC", which he described as "transparency, longevity and certainty".

Merlin Hyman, chief executive of Regen SW, welcomed the announcement, saying: "What needs to happen is to get industry and DECC working together to set out a long-term framework for this sector to grow. This is the first step."

The consultation exercise itself was fraught with chaos after the Government was deemed to have acted illegally in rushing ahead with cuts to the tariff. Mr Barker yesterday confirmed DECC would continue with its costly taxpayer-funded appeal in, he said, an attempt to save the taxpayer millions of pounds.

Mr Barker said that under Labour's scheme a "very small number of people were enjoying bumper returns". He added: "This is a much fairer scheme that we are improving now and we will see as a result far more deployment but actually at a fairer rate and that will be good for consumers who pay for this on their bills."

Ian Smith, of Cornish social enterprise Community Energy Plus, said: "It's good to see that common sense has prevailed and something positive has come out of such a contentious and poorly executed government consultation exercise."

Responding to a Commons question from St Ives MP Andrew George (Lib Dem), Mr Barker said the Government wanted to help community groups benefit from energy subsidies, rather than see their projects falter due to reduced tariffs.

DECC estimates that the new system will deliver 620,000 new installations up until 2015 for £500 million, far less than the £1.7 billion cost of the 250,000 solar projects already installed.