Encraft statement on rejection of DECC’s appeal against the High Court Judgement concerning solar feed in tariffs

Encraft welcome yesterday’s emphatic dismissal of DECC’s appeal against the High Court judgement in December that the sudden change in feed-in tariff rates was unlawful.

In our view the short-term implications of today’s judgement will be limited, as six weeks remains too short a time period to develop responsible and quality projects at any scale. Indeed one of the many frustrations we have with the government’s behaviour is that the main effect of their October announcement has been to create a market environment in which only risk-taking cowboys can thrive.

However, the longer-term effects are significant and encouraging. As a result of the High Court process, the FIT regime and the government’s ability to intervene in the regulatory system has been thoroughly tested and the boundaries set. The market knows where it stands and participants can act with confidence again.

Today’s judgement is that when the government offers 25 year promises through FITs or RHI, or any other scheme, they must stick to them, and cannot act retrospectively. This means investors in all small scale renewables and energy efficiency projects in the UK can invest with confidence. It means companies like Encraft can invest time and effort in developing innovative large scale projects on housing and buildings without risking this effort being wasted. It should also be a wake up call for the government, so they realise that they need to think and act more carefully when setting and managing the details of energy and construction schemes.

We believe the government have a fundamental responsibility to manage the economy fairly and competently, and should be held to account by the judicial system for the way they implement democratically agreed policies. DECC were responsible for setting feed-in tariffs in the first place; for monitoring progress, and for adjusting them in response to market developments. Sadly, they failed to do any of these things in a prudent, practically-informed and measured way, and then sought to abuse their powers in a way that saw responsible market participants suffer most.

The constructive way forward is for DECC officials and ministers to develop a more robust and better informed, technology-independent perspective on the market, to avoid this kind of debacle in future. We will be writing to DECC today to invite the minister and officials to visit Encraft and some of our long-term multi-technology projects and clients, with a view to supporting this process.