Government moves to cut incentives for new solar power installations could hit the Sheffield region harder than most, according to city accountants UHY Wingfield Slater.
“In addition to being the UKs greenest city, Sheffield also tops the UK league for renewable energy per head of population and the local boom in solar power, aided by generous government incentives - known as feed in tariffs - has brought a well needed boost to the local economy,” says the firm, based at Broadfield Court, Heeley.
“The future of this sector now appears to be in doubt, which could impact those businesses in Sheffield that have sprung up to service the sector.”
Research by the firm has shown there are nearly 40 local companies installing solar panels in the Sheffield area, in addition to national companies. Two thirds of those firms have been launched in the last three years.
“It is hard to find any other sector that has grown so dramatically in this period,” says UHY Wingfield Slater.
“However, the proposed slashing of government incentives from 43.3p to 21p per kilowatt hour from December 12 may well mean this boom will collapse as quickly as it started.”
Director Andrew Hulse says the Government cuts will nearly double the payback time: how long it takes to recoup the costs of the panels and their installation through reduced energy costs and the feed-in tariff.
But the arrival of much cheaper solar panels and the continuing rise in the price of fossil fuels also has to be taken into account.
“When these issues are considered, the investment in solar starts looking more attractive again.”