Entu said it expects market conditions to become “increasingly difficult” due to a possible 15 per cent increase in VAT for its solar products and “uncertainties concerning the future level of FiT”.
Last week the Department of Energy and Climate Change (Decc) announced the latest in a series of subsidy cuts for the renewables sector as the government attempts to rein in its spending following the revelation it overspent on the £7.6 billion levy control framework (LCF) by £1.5 billion.
Decc has suggested it would close the FiT to new applicants by January 2016 if cost control measures are not implemented or prove to be ineffective.
The company now estimates that it will lose in excess of £2 million during the current year from its solar activities against a budgeted contribution of £1.6 million.
Entu does not believe its solar business is likely to make an acceptable return in the medium term and therefore after fulfilling current obligations Entu will discontinue its retail solar activities.
Entu chief executive Ian Blackhurst said: “The prospects for our solar business have deteriorated dramatically over the last six months, and we have taken a decision which I have no doubt will be seen to be correct. However we have disappointed our shareholders and I can only assure them that we are entirely focused on restoring earnings, dividends and shareholder value.”