| Posted on October 28, 2011 at 11:45 AM | 
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It appears that a recently leaked document from the Energy Saving Trust has let the cat out of the bag on the Government's plans to cut the subsidy for solar photovoltaic installations.
The long rumoured cut seems set to be pegged at 21p/kWh, significantly down from the original 43.3p/kWh for retrofitted systems under 4KW in size, where the vast amount of installation activity has been undertaken or planned.
This major cut will have wide-reaching implications for the entire industry and will require a number of projects to revisit their financial models to ensure things still stack up. Whilst on the one hand the argument that the subsidy needs to be cut because of the significant increase in installations and reduction in system costs can only be good news, doubts remain as to whether this is too much, too soon for a still growing and maturing industry. It also impacts on the Government's plans to see green energy at the forefront of our economic recovery.
If this is indeed the level the subsidy will be set at it will have an impact - and it remains to be seen whether it's as bad as feared. Personally, a cut bigger than 50% may be too hard for the industry to take.
The long rumoured cut seems set to be pegged at 21p/kWh, significantly down from the original 43.3p/kWh for retrofitted systems under 4KW in size, where the vast amount of installation activity has been undertaken or planned.
This major cut will have wide-reaching implications for the entire industry and will require a number of projects to revisit their financial models to ensure things still stack up. Whilst on the one hand the argument that the subsidy needs to be cut because of the significant increase in installations and reduction in system costs can only be good news, doubts remain as to whether this is too much, too soon for a still growing and maturing industry. It also impacts on the Government's plans to see green energy at the forefront of our economic recovery.
If this is indeed the level the subsidy will be set at it will have an impact - and it remains to be seen whether it's as bad as feared. Personally, a cut bigger than 50% may be too hard for the industry to take.
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