Energy companies developing solar "farms" have hit out at a review aimed at removing green subsidies from the commercial ventures, warning they represent better value for money than household solar panels.
The Government has announced it is reviewing the feed-in tariffs scheme amid concerns large-scale solar electricity schemes were cashing in on the incentives designed to boost small-scale renewables.
The tariffs, which are financed by small increases on household energy bills, pay people and organisations for the "green" electricity they generate from small-scale solar panels, wind turbines and other renewables.
But with subsidies paying out for solar electricity installations of up to 5 megawatts, the equivalent of 200 homes having the panels on their roofs, solar farms which stretch over a number of acres are being given the go-ahead.
The announcement of the review has thrown the solar industry into uncertainty. It has also provoked criticism from businesses investing in solar farms, who claim that, as a result of economies of scale and the lower payments provided for large-scale operations, their installations are a more efficient use of the money being channelled into generating green electricity.
Ken Moss, chief executive of solar developers mO3 Power, said it “costs consumers £24 million to put 5MW into the grid from rooftop arrays - it only costs us £12.3 million from a single farm”.
"It is subsidising large-scale solar photovoltaics (PV) developments which is the most efficient use of taxpayers' money. Commercial developments have the capacity to drive down the technology costs, produce more power, and cost less,” Moss said.
"Plus they receive less in subsidies than domestic arrays, giving the Government and the taxpayers more bang for their buck," he said.
Dale Vince, founder of green energy firm Ecotricity which is developing a solar park in Lincolnshire, branded the move by ministers "ill-conceived".
He said large scale solar costs around 30 per cent less to generate electricity per unit than small PV panels on homes.
He claimed the new Government was confusing the debate by talking about the scheme's "pot of money" which could be squeezed by big solar, as the feed-in tariffs scheme had not been set up to run within a fixed amount of money.
But ministers had effectively set a £360 million cap on the scheme by saying they wanted to cut the spending on the programme by 10 per cent, reducing it from an estimated cost of £400 million by 2014/2015.
He said he thought ministers were really being driven by concern about solar farms, which could make a big difference to where the UK gets its electricity, being built in the countryside, for example on farmland.
He warned Ecotricity's 1MW solar farm in Lincolnshire, which is set to start generating electricity by April and therefore is not subject to the review, could end up being the UK's only commercial solar electricity site.
"I think the review will kill all big solar. The uncertainty will do the job long before they change the rules," Vince said.
A Department of Energy and Climate Change spokeswoman said that it was “not against solar farms, they can reduce carbon emissions and contribute to our renewable energy target, what we don't want is for large scale solar installations to be claiming money meant for householders, small businesses and communities”.
"The renewables industry is a vital piece in the green growth jigsaw and this review will help to provide long term certainty while making sure homes, communities and small firms are encouraged to produce their own green electricity," the spokeswoman said.
Europe’s biggest manufacturer of solar panels, Sharp, said the 300 new jobs at its plant in Wrexham, North Wales, announced last month, would not be at risk as a result of the review.
Sharp head of international sales Andrew Lee said the company was "very disappointed" with the Government's decision to review the subsidies for projects of more than 50kw - the equivalent of around 20 houses installed with PV panels.
But he said: "The feed-in tariff has sparked huge interest for domestic PV installations in the UK, while demand for solar PV remains high across part of mainland Europe.
"This is precisely why we have continued to invest and expand our European factory in Wrexham."