A pioneering project to provide 22,000 tenants of social housing schemes with solar panels generating free electricity is in jeopardy. Fears the government will cut subsidies for solar installations have prompted Empower Community to pause investment until clarity from government is gained. The project, planned by Empower Community, a charity-backed social enterprise, is supported by eight local authorities and housing associations, along with a major pension fund investor. Empower says families would have saved an average of 120 from their electricity bills by using free solar power during daylight hours. It was designed to take advantage of the feed-in tariff, originally designed to encourage renewable energy generation.

Installations were planned for Wales, Yorkshire, East Anglia and Lincolnshire, with the work starting in January and finishing in March 2012.

However, when rumours started circulating about possible cuts to the feed-in tariff, Empower put their £175m investment on hold.

Last week, many media sources claimed that it seemed likely that the feed-in tariffs will be cut to 9p for all systems under 50kW when the Comprehensive Spending Review documents are finally published. According to ‘industry sources’, tariff levels could “fall from the current level of up to 43p per kilowatt hour generated, to as little as 9p per kWh […] if the Government follows past precedent, any change would not affect homeowners with existing solar panels,” reported the Financial Times.

Business Green published, “Some experts are even suggesting tariffs for all solar installations will be cut from current levels of between 15p and 43.3p per kilowatt to just 9p per kilowatt (kW),” which was also revealed by a “well-placed industry source”.

Yet, according to Emma Hughes from the Solar Portal, the current rumours are just rumours.

On speaking with the Department of Energy and Climate Change (DECC), she was told - “As we’ve previously said, all tariffs in the scheme are being considered in the Comprehensive Review and we will be consulting on proposals later this year. We’ve made clear that tariffs will remain unchanged until April 2012 unless the review indicates the need for greater urgency.

“There has been no announcement about the review so any rumours about its content are just that, rumours and speculation.”