Following changes to the cost control mechanisms for the solar power feed-in tariff (FIT), the government has cut its forecast for the capacity of solar electricity panels by almost half.
Department of Energy and Climate Change (DECC) publicised that it would cut solar subsidies by almost 25% from August followed by further cuts every three months depending on whether deployment remained on target.
DECC further announced that the FIT payment period will be reduced from 20 years to 25 years. Figures contained in the government’s official impact assessment, which accompanied the changes to the scheme announced revealed that the DECC downgraded its estimate of the installed capacity of photovoltaic (PV) panels from 22GW to 11.96GW by 2020.
The impact assessment also revealed that the level of capacity by 2020 could be as low as 3.5GW or as high as 21.1GW. On three occasions over the last year the number of installations has increased before reductions to the FIT were introduced, falling drastically when they were implemented.
