Solar Century Holdings Ltd & Ors v Secretary of State for Energy And Climate Change

A stated policy end-date does not create an immutable legitimate expectation that a government scheme will remain unchanged until that date. The question is whether a specific undertaking, directed at the relevant individual or group, assured continuance; rational grounds may justify reformulation unless prior conduct makes the change an abuse of power. Statements that existing support will be maintained ordinarily concern accredited installations and accrued support, not pipeline investments, where expenditure controls reserve policy adjustment. A statutory power to close a support scheme after a specified date is not confined to the previously announced date and may specify different dates for different cases or circumstances. Changes affecting unaccrued future eligibility are not objectionably retrospective merely because past conduct has acquired different consequences.

The appellants, companies developing large-scale solar photovoltaic installations, challenged the Government’s decision to close the renewables obligation scheme early for new solar PV capacity above 5 MW. The previously announced closure date was 31 March 2017; the revised closure date was effectively 1 April 2015. A grace period was provided for projects meeting specified investment criteria by 13 May 2014.

Green J granted permission at a rolled-up hearing but dismissed the judicial review application: [2014] EWHC 3677 (Admin). The appeal concerned whether the early closure was outside the statutory power, contrary to clear assurances or legitimate expectations, or unfairly retrospective in its treatment of pipeline investments. The central question was whether the Government had lawfully changed its policy in the light of the expenditure limits and risks under the Electricity Act 1989 framework.

1. The appeal was dismissed unanimously. Floyd LJ gave the leading judgment. Treacy and Tomlinson LJJ agreed.
2. On legitimate expectation, the court applied the principles in Bhatt Murphy v Independent Assessor [2008] EWCA Civ 755. A stated end-date does not create an immutable presumption that policy will continue unchanged until that date. The question is whether there was a specific undertaking, directed at a particular individual or group, by which continuance was assured. Government may reformulate policy where rational grounds exist, unless its prior conduct makes the change an abuse of power.
3. The Levy Control Framework formed important context. Its provisions warned that higher-than-expected deployment would not enlarge the expenditure cap and reserved the right to adjust policy. References to maintaining support for existing investments concerned accredited installations subject to grandfathering, not pipeline projects. No legitimate expectation arose that the scheme would remain open until 2017 despite deployment threatening the cap. The same reasoning defeated the alleged clear assurances.
4. Section 32LA of the Electricity Act 1989 authorised a closure order preventing certificates being issued for electricity generated after a specified date. The power was not confined to 1 April 2017. Its express provision for different dates in different cases or circumstances permitted the Secretary of State to close the scheme earlier for large solar PV installations above 5 MW.
5. The changes were not objectionably retrospective. They altered the consequences of past acts or omissions concerning installations that had not accrued an entitlement, without altering their legal nature or effect. This differed from Secretary of State for Energy and Climate Change v Friends of the Earth and others [2012] EWCA Civ 28, where an accrued payment entitlement was altered.
6. The retrospective impact of changing the rules after investment began was a factor in assessing public-law fairness and rationality. The Secretary of State was not required to protect every investment exceeding a de minimis level. A line had to be drawn, and the consultation, policy reasons, and risk of accelerating pipeline investment justified the selected conditions. There was no basis for judicial review interference.

• Court of Appeal (Civil Division): dismissed the appeal from the decision of Green J.
• High Court of Justice, Queen’s Bench Division, Administrative Court: at a rolled-up hearing, granted permission for judicial review but dismissed the application: [2014] EWHC 3677 (Admin).