At Greener Ideal, we’ve brought you stories in the past of booming solar panel sales and the trendy reputation the industry has been experiencing. But a report from the Guardian says the number of UK homes installing solar panels has fallen dramatically since the start of August. And the sharp drop reportedly comes after a cut in subsidy rates by the government.
New figures were published last week, showing a huge rush by householders aiming to install panels before an August 1st government deadline. That was then quickly followed by a huge drop. The Guardian reports that there were nearly three-quarters less capacity installed in the past six weeks than the equivalent weeks in 2011 for the feed-in tariff scheme. This subsidy pays householders for generating green energy.
Members of the solar industry spoke to the newspaper about this decline. Some of them said this drop did not undermine its claims that panels still represent an attractive financial investment of around 10% annually.
Paul Barwell is the chief executive of the Solar Trade Association. He told the Guardian: “The returns are certainly still there [despite the tariff cuts] because the costs have continued to come down. While a 4kW system has dropped in cost from around £9,000 in April to £7,500 now, tariff drops are a problem for consumers because that’s what they see. August is generally a poor installation month anyway because people are away from their homes.”
He went on to the tell the newspaper that he didn’t expect to see a “cliff-edge drop” when the next cut – a much smaller one of just 0.5p rather than 5p as seen in August – comes in November.
Under the rule changes in August, the Guardian says the length of the payment period was also cut from 25 to 20 years, although there was a small sweetener in the form of a rise from 3.2p to 4.5p for each kWh of energy exported to the national grid.
Photo via OregonDOT