FARMERS looking to install solar panels on their properties should move quickly before subsidies are slashed further by the government.

From March 3, the amount paid will drop by half from 42p to 21p per kilowatt-hour for installations of less than four kilowatts.

It is believed the move will save the Treasury around £700 million a year.

However, the department of Energy and Climate Change (DECC) has now revealed it is proposing a reduction in Feed-in Tariffs (FITs) for solar installations of 10 percent every six months.

The changes are now going out for consultation. It is thought the final plans will also take into account the number of installations of panels between March and April.

The huge uptake in solar energy has seen the government struggling to meet the budget for the FITs.

Gregory Barker, minister for energy and climate change, told a briefing: “What we have to do is capture these falls in prices for the consumers so they get better value and we put the solar industry on course to becoming a mass market competitive alternative to fossil fuels.

“Never again should we have a fixed price tariff that allows a bubble to grow and offer unduly large rewards,” Mr Barker added.

It is believed a mechanism will be introduced into the new agreement that will see subsidies cut further whenever the number of installations reaches a trigger point.

The DECC said: “Such rapid changes to the size of the subsidy would be in direct response to market signals. So the tariff changes should have a stabilising rather than a destabilising effect.”

The decision to cut the solar subsidies have been met with fierce criticism from both environmental groups and solar energy firms.

Barker said the lower tariffs will allow for more solar instalments overall, and said the government expects Britain to have 22 gigawatts of solar power generation by 2020.

A new tariff rate of 21 pence per kWh will apply to all home solar installations from March.

A separate tariff of 16.8 pence per kWh will apply to organisations with 25 or more installations from April.