Solar cos win court battle with DECC in FiT cuts case

Jul 10, 2014 - The High Court yesterday ruled in favour of 14 firms seeking GBP 132 million (USD 226m/EUR 166m) in compensation from the UK government for the commercial damage it caused in 2011 by cutting early the solar feed-in tariff (FiT).

Energy specialist firm Prospect Law said in a statement that the exact damages cased by the Department of Energy and Climate Change’s (DECC) illegal actions will be confirmed in the coming months. “[..] the claimants have demonstrated an entitlement to damages assessed by reference to the loss of those possessions for which recovery is permissible, namely signed/concluded contracts and/or the marketable goodwill referable to such contracts,” said Justice Coulson, the High Court Judge on the case.

It all started in October 2011 when the UK government said it would slash the solar FiTs by 50% in only six weeks’ time with the aim of ensuring the scheme would not exceed a spending cap. The announcement came a few weeks before a government consultation ended. According to the claimants in the case, DECC’s decision has had “catastrophic” consequences as it undermined confidence, led to the loss of over 6,000 jobs in the sector and saw the local solar industry contract by 25%.

“​The sector could have been well on its way and employing substantially more than the 16,000 workers it does today, down from 25,000 at the time of the cuts, if the Government had acted in a legal and responsible way in 2011,” Prospect Law said.

The High Court decided in December 2011 that the government's plan to bring forward cuts to solar tariff payments were "legally flawed". The DECC filed a request to appeal the ruling but was unsuccessful. In January 2012 the Court of Appeal confirmed the ruling of the High Court.

(GBP 1 = USD 1.712/EUR 1.256)

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