The stressed solar industry has seen a dramatic increase in installations in anticipation of further cuts to the feed-in tariff. On 1 August, the feed-in tariff for solar power, paid to homeowners who install solar electric panels, was cut to 16p per kWh from 21p per kWh – a rate that was introduced in March this year after a prolonged legal battle.
In the week preceding the August cut, the amount of solar capacity installed shot up to 42MW from an average of 10MW a week in the three months following the introduction of 21p per kWh rate in March. The rise is the fourth spike in activity in the past year. However, experts have predicted that the increase will be followed by a significant fall in solar panel installation activity in early August as customers shy away on the idea of installing solar electric panels with a 5p lower feed-in tariff.
If installation targets are met, the government will re-examine the amount of solar capacity installed each quarter and cut the tariff by 3.5%. It has been reported that the industry hopes that this will end the cycle of large spikes in installations followed by dramatic drop-offs
