JobJustice: Further job losses on the horizon as 2012 approaches

New Government measures could are likely to mean that green energy companies will have to cut the number of employees. This is likely to be a consequence of this week’s Government announcement that anyone who installs a solar panel power system after 12 December this year will only be paid half of the current Feed-in-Tariff (FIT).

Under the Government’s FIT scheme, consumers who install electricity-generating technology from an environmentally friendly source may be entitled to get money from their energy supplier. For consumers, this means that the price of their electricity bills will decrease.

According to the Government, there is not sufficient room in the budget to cover the current tariff of 43 pence, which they propose to decrease to 21 pence.

The suggested cut to the Feed-in-Tariff, which is still subject to consultation, comes after the Government carried out its Comprehensive Consultation last year.

Following the announcement of the cut, shares of solar companies fell significantly. However, Gregory Baker, the Climate Change Minister, in an emergency debate at the House of Commons, explained why it was no longer viable to maintain the current tariff.

"Falling PV [photovoltaic] costs mean returns are double those originally envisaged for this scheme... if we don't act now the entire £867m budget would be fully committed within the next few months."

The industry was disappointed with the little time that makers and installers of solar panels will have to adapt before the new tariff takes place, if it is implemented. Moreover, many industry spokesmen agreed that thousands of jobs would disappear as a direct result of the cut’s implementation.

Ray Noble, from the Renewable Energy Association, said, "I've talked to some companies who are looking at pulling the plug in weeks - it probably reduces the size of the industry by 15,000-20,000 jobs".

Beyond job losses, affected companies will struggle to implement some of their schemes. For instance, companies having considered initiatives which seek to provide free solar panels to thousands in social housing will be left struggling to finance their initiatives. However, the government announced that it intended to look into how such incentives could be financed, which they hoped would be of assistance.

Echoing the criticism of the proposal, the Shadow Energy and Climate Change Minister, Caroline Flint, said "With growth flatlining everywhere else, today's announcement threatens to strangle at birth the solar industry".

At a time when job opportunities are few, the proposed cut has already been the cause of much concern. It remains to be seen whether it will be implemented in the short time-frame suggested.

JobJustice

Friday 4 November 2011

Further job losses on the horizon as 2012 approaches

No comments:

Post a Comment