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Norwich solar firms go into liquidation in the wake of government subsidy cuts - leading to job losses

PUBLISHED: 08:11 30 March 2016 | UPDATED: 08:11 30 March 2016

Solar panels generic; Photo: Bill Smith

Solar panels generic; Photo: Bill Smith

Archant © 2011

Two renewable energy companies have closed in the wake of cuts to government subsidies which have dried up order books and driven firms into liquidation.

Eco Juice and Absolute Renewable Energy (UK), both based in Norwich, said they were forced to close after the government cut solar subsidies from 12,47p per kilowatt hour to 4.39p/kWh in February .

They claimed it meant homeowners, who are paid for every unit of electricity their domestic panels generate – known as a feed-in tariff – had fewer incentives to opt for a solar installation.

The move came after the government highlighted concerns the £7.6bn budget for renewables would be drastically overspent, and argued solar and onshore wind projects should largely be able to support themselves.

Absolute Renewable Energy (UK), based in Delft Way near Norwich airport, went into liquidation on February 17 after piling up debts of about £800,000, although around half of this was to its parent company, Avonside Group Services.

Liquidator Dean Watson, partner at Begbies Traynor Insolvency Practitioners, said the firm employed 25 people and also contracted about 40 self-employed sales people. “The firm got to the new year and the order book was drying up,” he said.

Eco Juice, founded five years ago, also ceased trading on February 17, citing lack of business as a result of the feed-in tariff. Director Peter Fleetwood said he was forced to let two workers go, but said solar panels were now a “hard sell” due to the government’s subsidy cuts.

Liquidator Jamie Playford, of Leading Corporate Recovery, said the company had accumulated creditors of about £43,000.

James Brabben, a lead analyst at Norwich-based Cornwall Energy, said people who had built businesses on the previous rates were struggling.

But he said there was more solar installed in 2015 than the previous three years in total, adding: “People have said this is a victim of its own success. So much solar was put out they had to control the costs.”

The Solar Trade Association said although there had been an 80pc reduction in solar panel installations since last February, the market was evolving with new ideas including solar set-ups with home battery systems, enabling consumers to reduce their dependence on the grid.

How are changes in energy subsidies affecting your business? Contact sabah.meddings@archant.co.uk.

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8 comments

  • @Larson - Yes but they along with nuclear are the backbone of our main power needs. For all the wind and solar you build, you need matching fossil and nuclear to back it up when they are not working. We can lose the wind and solar, we can't lose the others just yet. They are worth the subsides as they can run 24~7~365.

    Report this comment

    Resident Smith

    Thursday, March 31, 2016

  • "...If the Govt. pulled all subsidies from Wind and Solar then all those farms would be sold for scrap within a week..." . They are nothing compared to the subsidies ( generous tax breaks ) given to fossil fuel companies.

    Report this comment

    Larson Whipsnade

    Wednesday, March 30, 2016

  • David Ward - you are incorrect. The price at Hinkley is three times the current wholesale price and still EDF won't start building. Radio Somerset, this morning, is broadcasting a clip from an EDF board member saying that he will vote against it when it returned to the main board. There will be a major delay and, as you say, lights will go out. The problem is not that of renewables. It is a lack of an energy strategy which can be traced back to the method used to give away the energy industry in the 1980's. That was a huge con-trick and paved the way for snake oil salesmen and eliminated any profit in generating power. Stupid policies and I see that most of Norfolk MP's still subscribe to that doctrine - ergo the population. So glad that I no longer live there.

    Report this comment

    shocked at stoopidity

    Wednesday, March 30, 2016

  • Any business whose existence was predicated on a constant supply of government money would be on a sticky wicket to start with. And to run up nearly a half-million in credit to a parent company looks particularly careless.

    Report this comment

    G_of_Norwich

    Wednesday, March 30, 2016

  • If the Govt. pulled all subsidies from Wind and Solar then all those farms would be sold for scrap within a week. No one did it for the good of the planet.

    Report this comment

    Resident Smith

    Wednesday, March 30, 2016

  • If they were that good no subsidies would have been needed to intice customers.

    Report this comment

    Orson Carter

    Wednesday, March 30, 2016

  • The only outcry there should be is why the government threw obscene amounts of money at solar and wind projects in the first place. They will never provide more than a small contribution to our energy needs, and thanks to their wildly variable output, have to be backed up 100% by conventional power stations. Since "renewables" get priority access to the grid (and get paid whether their power is needed or not), those conventional generators are finding it difficult to stay in business. This has resulted in the crazy situation at Hinkley where a guaranteed price for electricity produced, of more than double the current market rate, is being offered in an attempt to get a new nuclear power station built. There will be an "outcry of protest" - but it will be when large scale power cuts start taking place next winter. Maybe then some heads will be knocked together in what passes for "government" and people who actually understand how the grid works will be put back in charge.

    Report this comment

    David Ward

    Wednesday, March 30, 2016

  • The removal of subsidies is crazy and wrong given the amount the government is spending to support some very dodgy nuclear power plants. There really needs to be an outcry of protest

    Report this comment

    petential@aol.com

    Wednesday, March 30, 2016

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