Subsidies for homeowners who instal solar panels will be slashed by more than half in 2012, according to leaked documents published by a government-funded agency.
Cuts to the feed-in-tarriff scheme, which rewards households for using renewable energy, will see the amount they earn fall from 43.3p per kilowatt hour of solar power to 21p.
Returns will fall from about 7 per cent to 4 per cent, official papers published on the Energy Saving Trust (EST) website suggest, in a move that could make the technology affordable only to the wealthy.
The move would almost double the length of time it would take for solar panels to become cost-effective, meaning it would take homeowners an estimated 18 years to earn their money back rather than 10.
Solar panels have dropped in price from an average of £13,000 to £10,000 over the past two years, meaning the amount consumers could save has steadily risen.
But the documents, which are marked as “under consultation and not final”, indicate that th technology could become much less affordable next year.
A spokesperson for the Department for Energy and Climate Change said: “We will be publishing a full consultation on changes to the solar PV [photo-voltaic] tariffs in Parliament on Monday.
“EST inadvertantly published a draft of documentation on its website that was neither final nor accurate.”
A statement on the EST website confirmed the document had been published by mistake due to a “technical error”.
If the rates are changed they would come into force from 1 April 2012, and would not apply to solar panels that have already been installed or that are set up before December 8.
But with panels typically taking eight weeks to install the window for attracting the higher rate is closing fast and households who have already invested in the equipment but not begun using it could lose out.
Jeremy Leggett, chairman of Solar Century, a solar installation company, said: “This is what you would do if you wanted to destroy something.
“Small companies, community projects and social housing will no longer be able to take advantage of solar panels.”