LONDON (Reuters) - The UK government on Thursday recommended slashing subsidies for solar panels on homes from July 1 after a boom in installations last year nearly exhausted its support budget.
The move paves the way for a gradual and sustained lowering of the tariff that aims to control spiraling costs and restore faith in the industry, according to a consultation document.
It follows a government decision set out last month to halve subsidies from March 3 to 21 pence per kilowatt-hour, which could save it an estimated 700 million pounds annually by 2014-15.
Solar installations in Britain have skyrocketed since the government introduced subsidies in April 2010.
Last year, Britain installed around 3 percent of the world's new solar panels, double the numbers added in much sunnier regions such as Greece or Israel, figures from the European Photovoltaic Industry Association showed.
The number of installed solar projects in Britain doubled in less than two months to 230,000 projects until December, government data showed.
"Our new plans will see almost two and a half times more installations than originally projected by 2015 which is good news for the sustainable growth of the industry," Climate Change Energy Minister Greg Barker said in a statement.
Barker also said he expected Britain to have 22 gigawatts of solar power generation by 2020, according to his verified Twitter account on Thursday.
The government said its new tariff rate of 21 pence per kWh will apply to all home solar installation from March. A separate tariff of 16.8 pence per kWh will apply to organizations with 25 or more installations from April, it added.
(Reporting by Oleg Vukmanovic; editing by James Jukwey)