WMN opinion: Solar subsidy cuts do not mean end for the industry

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Friday, February 10, 2012
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Western Morning News

We’ve known for some time that subsidies to the solar industry were going to have to be drastically cut. So today’s reform of the payments, designed to encourage the development of more renewable energy but at an affordable level, won’t have come as a big surprise.

It is difficult to challenge the logic of the cuts. While it was unacceptable for ministers to introduce such drastic reductions in such a short timescale – a move already overturned by the courts – the principle that the Feed-in Tariff had to come down was never in doubt. It was, after all, devised as a way to offset the relatively high cost of installing solar panels. As those costs have fallen it seems only reasonable the subsidy – which is paid for by taxpayers – should fall as well.

On that basis yesterday’s announcement from Energy Minister Greg Barker that subsidies will now track the falling costs of solar technology, effectively halving them from current levels, cannot be considered a disaster. Any sensible observer will accept that renewable energy production must, in the end, stand on its own two feet commercially.

The purpose of subsidy has always been about creating an incentive for businesses and individuals to invest in what has been, up to now, expensive technology. It stands to reason that the cost of running the technology, with no input costs beyond maintenance, is going to be cheaper in the long run than conventional energy production which needs coal, gas or oil to make it work.

The industry complained yesterday that thousands of jobs have been put at risk by the subsidy cuts. That is true, we suggest, only because of the indecent haste in which the Government wanted to bring in the reductions. Looking to the longer term it still ought to be possible to maintain a thriving solar installation industry on the level of subsidy as currently proposed. Indeed community schemes, arguably those with the greatest benefit since they help communities become more self-sufficient in energy, will be encouraged by these changes.

The Government has handled the cuts to the Feed-in Tariff badly, make no mistake about that. But the courts have stepped in to put right the worst of ministers’ blunders and now we should be on course for a more transparent and justifiable level of subsidy. That is where we have to be, if green energy is to take its rightful place in the mix of power generation Britain needs.

The Badger Trust has made the first move to challenge the Government’s proposed pilot cull of badgers, due to take place here in the South West. It has outlined its objections and appears fully prepared to take the matter to court. What a shame an organisation that is such a doughty defender of the badger cannot work with farmers and others to help beat bovine TB. The Trust is keen enough to rubbish this cull yet has no credible alternative to overcome the disease.

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