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The Impact of the Solar Damages outcome for the British Renewable Industry

In 2011, the UK Government’s Department of Environment and Climate Change (DECC), announced unlawful policy changes to the feed in tariff (FiT) for solar power generators in the UK. The FiT changes were deemed unlawful and unfair and in July 2014, the High Court granted £132million in damages to the 14 companies involved in the case to compensate for the negative impact and stifling of business that they suffered. (Read article here)

It was a novel case for the solar industry for two reasons. Firstly, human rights violations had been introduced in relation to compensation for commercial losses suffered by solar firms, and secondly it was the first time that contracts for solar projects relying on FiTs had been qualified as “possessions”.

The positive outcome of this standout case sets a precedent for policy regulation. It shows that the UK’s solar businesses have a right to legal certainty for FiTs and that any policy mismanagements will not go unaccounted for by the courts.

There is a great opportunity ahead of us with the solar industry in terms of creating a viable alternative energy source, helping the economy grow. It plays a large part in meeting the EU’s 2020 target for 15% of all energy usage in the UK to come from renewable energy. If it was left to grow organically without interruption, we could see it as economically sufficient to power big cities. The UK Government has a target of 32% of electricity to be produced by renewables by 2020. (Renewable Energy Roadmap) DECC indicates that £100-110 billion in new investments is needed to make that figure. We need the Government to get behind the solar industry and recognise that it is in a good position to help meet these targets.

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