• Solar Thermal Subsidies Cut as Government Continues With Renewable Cutbacks

Business News

Solar Thermal Subsidies Cut as Government Continues With Renewable Cutbacks

Mar 16 2016

The conservative government have continued with their policy of withdrawing spending in the renewable energy industry by announcing a latest set of cutbacks, this time affecting solar thermal panels.

The panels, which harness the power of the sun’s rays to heat water that can be used in bathrooms and kitchens as well as central heating systems, had been receiving a significant subsidy from the government in order to encourage more British homeowners to install them.

However, at the beginning of the month, the Tories announced that spending into solar thermal will be cut entirely with the implementation of their renewable heat incentive (RHI) from 2017.

The Latest in a Series of Cuts

The announcement is just the latest in a string of cutbacks in funding renewable technology. In June of last year, the Tory government announced an end to subsidies in onshore wind farms from April 2016, a full year earlier than agreed upon with the Liberal Democrats in the previous coalition government.

Meanwhile, in December, solar power spending was revealed to be slashed by 64%, with the UK Energy Secretary Amber Rudd claiming that “when the cost of technologies come down, so should the consumer-funded support.” Indeed, there have been suggestions from some quarters that the cutting of solar power subsidies is not necessarily a bad thing, although the incumbent government has come under heavy criticism for their plans.

Now, solar thermal is the latest energy sector to be hit. After conducting a survey of all homeowners who had the panels installed and finding that over half of them admitted they would have gone ahead with the installation even without the help of a subsidy, the government has concluded that “solar thermal represents poor value for taxpayers”. The fact that it is the highest recipient of financial support under the RHI scheme was used as further proof of its liability.

Fierce Opposition

There has been an immediate and incensed reaction to the announcement, with Paul Barwell, head of the Solar Trade Assocation (STA) leading the charge.

“The government acknowledges the many benefits of solar thermal, yet proposes singling it out for the removal of financial support,” he explained. “With UK renewable heat deployment falling desperately behind target, government should be full square behind this technology as part of a strategic plan to permanently bring down heating costs for British families.”

There are fears that the decision to withdraw the funding would not only discourage homeowners from investing in the technology but also alienate investors. In turn, this could actually drive up energy prices as the industry suffers, thus achieving the opposite effect of this cost-effective technology.

“Discriminating against this globally important technology in the UK would send a terrible message to householders, and it would have very serious ramifications for the British solar thermal sector,” Barwell added.


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