The government’s re-launched Low Carbon Buildings Programme has come in for scathing criticism from the renewables industry after grants supporting householders installing microgeneration technologies were slashed.

The Programme, which aims to encourage the take-up of domestic renewables, ran into trouble earlier this year when the monthly grant allocations were used up within hours of being made available. It was later suspended pending restructuring.

Under the Programme, which restarts at the end of May, the DTI has abolished the monthly allocation of fund, but cut the maximum grant offered to householders from £15,000 to £2,500. This is despite the Programme receiving an extra £19 million of funding in the recent Budget.

Philip Wolfe, chief executive of the Renewable Energy Association, said: “While it is good news that the Programme will be back up and running, this scale-back makes a nonsense of the extra funds from the Chancellor and of the Government’s ambition to bring on-site power to the people. This will particularly hit PV and wind, which have been two of the most popular elements of the Programme.”

Wolfe added that demand has collapsed following the DTI’s decision to suspend the Programme and that with the unnecessary funding cuts it is unlikely to recover. “At such short notice, job losses and company failures will inevitably follow; losing vital experience at precisely the time we need strong growth in the expertise base,” he said.

In a further move, homeowners will now need planning permission in place before applying for grants towards small-scale renewables.