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National auditors called in over solar panel scandal

Parliament’s auditors have ordered an investigation into how the Climate Ministry and energy regulators repeatedly made mistakes over solar panel subsidies

Bags of rubbish are piling up in the city (photo: Paul Farmer)
June 25th, 2013 12:49 pm| by admin

Mounting questions over a number of expensive loopholes in solar power legislation will now be thoroughly investigated by the national audit office, Rigsrevisionen.

The investigation of the Climate Buildings and Energy Ministry and energy regulators Energistyrelsen was demanded by the parliament's auditing group, Statsrevisorerne, which consists of six appointed MPs responsible for ensuring taxpayer money is correctly spent and that government bodies work optimally.

The questions have focussed on the climate, buildings and energy minister, Martin Lidegaard (Radikale), and laws his ministry created to promote solar energy by providing generous incentives for selling surplus energy back to the grid.

Late last year the ministry realised that dropping price of solar panels, combined with the lucrative sell-back scheme, resulted in the number of solar panel installations to rise more than ten-fold, from 5,000 at the start of the year to 70,000 by the year’s end.

The ministry then passed a law to limit the number of solar installations, so that the amount of solar energy generated would not exceed the subsidised 800MW capacity that had been planned for by 2020.

The law turned out to have a number of loopholes, however. The first that was discovered allowed large subsidised installations to be placed in agricultural fields.

Lidegaard closed the loophole earlier this year but he received an official reprimand after Berlingske newspaper exposed how he had been informed of the loophole before the law was passed.

The saga continued last week when Energistyrelsen admitted it had failed to pass on information to Lidegaard about the effect of a second loophole allowing businesses to place large solar installations on the roofs of their buildings.

Energistyrelsen held on to the information for a week before handing it to Lidegaard, leading him to incorrectly tell an open parliamentary hearing last Thursday that subsidies for rooftop solar installations wouldn’t be too costly when they might well be.

According to Berlingske newspaper, Rigsrevisionen will have access to all the documents and communication between Energistyrelsen and the ministry and will also be entitled to interview the people involved.

Lidegaard welcomed the investigation into the scandal that could bury deep into his ministry’s civil service and may lead to firing of responsible staffers.

“I think it’s completely natural that Rigsrevisionen are investigating this case,” Lidegaard told Berlingske. “I want everything to be revealed because I have not made any errors or hidden anything from anyone. The situation has been unsatisfactory and I hope that we ensure that this does not happen again.”

The loopholes meant that many large solar installations were constructed in the belief that they would be eligible for subsidies that had never been intended for them.

In closing the loopholes, ministry came up with a transition scheme that will see the subsidy for large installations gradually reduced. This means both that the government has to fund any surplus solar energy being sold to the grid that had not been budgeted for, while companies that had installed the large solar parks in good faith, may end up going bankrupt.

Berlingske reports that the loopholes could cost the state up to 2.9 billion kroner. That money will be found by delaying other green energy projects such as the offshore wind farm Kriegers Flak.

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