Five more solar companies claim damages for solar fiasco

More companies have announced they will requesting payment of damages from the Department of Energy and Climate Change (DECC) for the ‘unlawful and unfair’ cuts to Feed-in Tariffs last year.

Previously three companies declared they were going to seek damages, but now five more companies have joined them. All the companies claim that substantial damage was caused to their businesses by the rushed-in cuts in December 2011. The three original companies requested that DECC pay £2.2 million or risk another High Court battle. DECC has responded by refuting liability and refusing to pay.

The legal team representing the companies, Prospect Law, has issued another formal ‘Letter Before Claim’ on behalf of the five new companies which brings the total claim to around £50 million. The company is also expecting more solar companies to come forward within the next few days.

“Sadly, the damage that the Government’s unlawful conduct caused the Solar PV industry was very serious indeed” said Simon Gillett, CEO of E-tricity. “The ministerial announcement at the end of October 2011 put a great deal of pressure on both the business and its employees, forcing us to make drastic cut-backs and cost reductions wherever possible. We are one of the lucky few that have been able to keep our business moving, but the reality is that the way in which DECC attempted to introduce these cuts to FiT rates caused our business and the industry significant damage and loss. By issuing a Letter Before Claim today we are requesting that the government acknowledges the losses it caused, and takes the appropriate action to compensate us.”

A representative from Prospect Law added that the 2008 energy Act and the regulatory regime which introduced Feed-in Tariffs effectively provided a set of rules by which the UK’s clean energy future would be delivered. The way in which it was administered created a ‘legitimate expectation’ within which both the industry and the public could operate. The cuts announced in late October last year however essentially ignored the government’s own policy framework.

“By casting aside the rules under which the solar industry operated, the Government caused major financial losses and materially harmed the confidence of both consumers and the industry” the spokesman said. “Solar is a robust industry, and one the public wants, but significant damage has been done to the sector. By issuing court action these claimant firms are asking the High Court to ensure that the Government is obliged to act responsibly, face up to its unlawful conduct and the damage this caused and is ordered to pay compensation.”

The law company said that companies seeking to join the damages claim against DECC have until October 31^st to do so. The original three companies that filed claims are Solar Power PV, Crystal Windows and Doors and Solarlec PV Solutions.

“While we can’t comment on the details of individual cases, the Department does not accept it has any liability and we will vigorously defend our position” a spokesman from DECC said.

Published by Robin Whitlock on October 22nd, 2012