Plans to Rewrite the Feed-in Tariff Rates would absolutely SHATTER Public Trust in the Government's Future Net Zero Policy.

At a time when the UK urgently needs households, businesses, and communities to keep faith in clean energy incentives, from rooftop solar and home batteries to heat pumps and EV charging, the Department for Energy Security and Net Zero (DESNZ) launched a consultation on 31 October 2025 that has undoubtedly raised some alarm bells across the renewables sector.

Whilst the consultation (which is open until 5pm on 12 December 2025) does not propose retrospectively slashing the original Feed-in Tariff (FiT) rates that people signed up to between 2010 and 2019. Those fixed generation and export tariffs (the headline numbers like 43p/kWh for early solar adopters or lower rates for later ones) remain untouched it does target the annual inflation uplift that has always been part of the scheme’s design.

What the Government Is Actually Proposing

FiT payments were never static: the original tariff is adjusted every April using the Retail Price Index (RPI) to protect the real value of returns over the full 20–25 year contract. This RPI link was a core selling point, it gave investors certainty that their payback wouldn’t be eroded by inflation.

DESNZ now wants to switch future uplifts to the lower Consumer Price Index (CPI) earlier than planned (the switch was already scheduled for 2030 when RPI is officially retired). Two options are on the table from April 2026:

1. Immediate switch to CPI – Future annual adjustments use CPI instead of RPI (CPI has averaged ~0.7–1% lower than RPI in recent decades).

2. Temporary freeze + realignment – Payments frozen at 2025/26 levels until a “shadow” CPI-adjusted tariff (calculated back to the scheme’s start) catches up, expected around the mid-2030s. Only then would CPI indexation resume.

The government estimates this could save consumers £20–70 million a year on FiT alone by 2030/31 (or £100–310 million combined with similar changes to the Renewables Obligation), equating to roughly £2–5 off the average household bill annually. The rationale: RPI is outdated, overstates inflation, and aligning with CPI brings legacy schemes in line with newer ones (Contracts for Difference, Smart Export Guarantee, etc.).

Why This Feels Like a Retrospective Change...and Why It’s Controversial

Even though the base tariff stays the same, altering the inflation mechanism mid-contract effectively reduces the lifetime returns that the ~850,000 existing FiT participants modelled when they invested, often tens of thousands of pounds of their own money.

• Broken expectations: Scheme documents and marketing explicitly promised RPI indexation to “maintain investor confidence” and protect real-value paybacks. Switching now (or freezing) feels like moving the goalposts years after the game started.

• Chilling effect on trust: Early adopters took the biggest risk when solar was expensive and unproven. If a “guaranteed, RPI-linked” tariff can be downgraded for fiscal reasons, why would anyone fully trust the next generation of incentives? The Boiler Upgrade Scheme, Green Gas Support Scheme, or future community energy frameworks all rely on long-term policy stability.

• Precedent risk: Industry bodies (Solar Energy UK, RenewableUK) and investors warn this echoes Spain’s 2010–2013 retrospective solar cuts, which triggered mass litigation, collapsed the market, and left a decade-long scar on investor confidence. While the UK proposal is milder, the principle – government altering contracted revenue streams to cut costs – is the same.

• Timing and optics: Coming amid uncertainty over heat pump grants, EV road pricing rumours, and broader levy reviews, it adds to a perception of policy whiplash rather than the “stable framework” the government says it wants.

If the government breaks the FiT contract retrospectively, the damage will go far beyond today’s solar installers.

Arguably, it would signal that no government scheme is reliable.

• Why would households trust grants for heat pumps or insulation?

• Why would community groups join future local energy programmes?

• Why would public bodies enter long-term PPAs or invest in rooftop solar?

• Why would investors believe anything this government tells them about clean energy returns?

This is how you destroy confidence in public policy: by showing that even legally underpinned agreements are vulnerable to political whim.

The Numbers Behind the Worry

• Around 850,000 installations still on FiT, mostly domestic rooftop solar.

• Annual FiT cost in 2026/27: ~£1.9 billion (levied on consumer bills).

• Historic RPI vs CPI gap: RPI has been higher in 28 of the last 30 years; the cumulative difference since 2010 is already significant.

• For a typical 4kWp solar system installed pre-2012 (43.3p generation tariff), the lost uplift over remaining years could run to several thousand pounds per household under the freeze option.

Where This Leaves Us

The consultation is genuine, no decision has been made, and DESNZ explicitly invites views on whether the changes are fair or proportionate. Many respondents (installers, generators, trade bodies) are arguing strongly against both options, highlighting legal risks around “legitimate expectations” and the broader damage to the UK’s reputation as a stable place for green investment.

Ministers still have time to listen. Dropping or softening the proposals would send a powerful signal that the government understands policy certainty is the oxygen of the net-zero transition.

If they press ahead regardless, the fiscal savings will be real, but the cost in eroded trust could be far higher, just when we need millions more households to believe that investing in clean energy is safe, predictable, and backed by a government that keeps its word.