The $320 million bonus scheme encourages households to reduce emissions by switching from older electric hot water systems to solar or heat pump systems.
Householders were eligible for up to $1,000 in rebates for making the switch.
The scheme was scheduled to run until the end of June, but at 5:00pm on Tuesday the Government declared that anyone who had not yet paid a deposit would miss out.
Parliamentary Secretary Mark Dreyfus has defended the sudden announcement as good practice, saying it stops a spike in demand pushing it over budget.
"As a Government of course we need to be fiscally responsible with taxpayers' dollars," he said.
"This was a time-limited program. It was always intended and always stated to be going to close in 2012 and that's what's occurring."
Greens Senator Christine Milne says that is appalling and jobs are at now risk, but Mr Dreyfus denies that.
"Local manufacturers, retailers and installers have known since the inception of the program five years ago that this program was closing," he said.
Senator Milne says it is no way to administer a renewable energy program.
"The Government apparently has learned absolutely nothing from Green Loans, from all the problems we had with the changed rules with the solar schemes previously," she said.
She says the scheme should have been extended, not cancelled early "at such ridiculously short notice".
"We've got manufacturers of solar hot water systems in Australia who are already suffering because of the high dollar and because of competition from imported, instantaneous gas from Japanese manufacturers," she said.
"One of the really big problems we've had with solar up to date is boom and bust - a set of rules put in place, then suddenly means-testing is introduced, then dates are changed, and the industry just throws up its hands.
"You've got manufacturers who anticipate a certain level of demand and then the Government cuts the rug from underneath them. It is not good governance. It is ad hoc. It's poor planning. And it's undermining the jobs of the future."
The Coalition's Greg Hunt says it is an echo of other schemes, like the green loan program.
"If this Government thinks standard practice is to give no notice, no warning, no readiness, no preparation and then to shut down an industry sector overnight then it has learned nothing from pink batts, green loans and the solar panel debacle that occurred under Peter Garrett," he said.
Gareth Jennings from manufacturer Rheem, which employs 1200 people at five plants, spent much of yesterday in Parliament House lobbying all parties to extend the scheme.
He found out it was being closed off at 4:55pm.
"I think it's fair to say that we're shocked," he said.
"Our industry is at its lowest level that it's been for around about five years and we just don't think now is the time to be withdrawing one of the few pieces of support that's still there to help establish a renewable energy industry."
John Grimes, the chief executive of the Australia Solar Energy Society, says the decision has left solar businesses gearing up for a last minute rush, in the lurch.
"It has been the pattern where when the public has become aware subsidies are being wound down, that people tend to act," he said.
"What that means is that solar hot water companies have scaled up for an expected spike in demand.
"Instead, all of that's stopped, and all of those jobs are now at risk."
Mr Jennings hopes the Government will reconsider its decision.
"We're now going to see the market perhaps halve overnight," he said.
"We've been successful in redeploying people as the market has been changing on us.
"But it's getting to the stage where we're going to have to take some hard decisions about our business."
SOURCE: http://www.abc.net.au/news/2012-02-29/solar-subsidy-scheme-cut/3858738?section=business
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