Government plans to cut subsidies for solar panels have been ruled legally flawed by the High Court.

The Government plans to halve the feed-in tariff, which pays people to generate electricity, for anyone who installed and registered after 12 December, even though the consultation on the plans runs until 23 December.

Pressure group Friends of the Earth and two solar companies, Solarcentury and HomeSun, went to court to test whether the short-notice proposals were lawful. Mr Justice Mitting said the Government was "proposing to make an unlawful decision".

Full details of the High Court ruling have not been released yet – even the organisations that launched the action are waiting to hear – but the ruling could mean that more people can benefit from the higher subsidy.

The Department of Energy and Climate Change will now seek permission to appeal against the High Court judgment, and has until 4 January to file its arguments.

Energy minister Greg Barker says: "We disagree with the Court’s decision. We will be seeking an appeal and hope to secure a hearing as soon as possible.

"Regardless of today’s outcome, the current high tariffs for solar PV are not sustainable and changes need to be made in order to protect the budget which is funded by consumers through their energy bills."

Friends of the Earth executive director Andy Atkins says: "These botched and illegal plans have cast a huge shadow over the solar industry, jeopardising thousands of jobs.

"We hope this ruling will prevent ministers rushing through damaging changes to clean energy subsidies."

How solar panels can save

Solar panels can save the typical home £90-£180/year in electricity, according to the Energy Saving Trust.

However, the real draw is the Government guarantees that for 25 years you'll get a 'feed-in tariff' which means you're paid to generate energy, even if you use it yourself.

Over 25 years, these gains were extremely lucrative. The feed-in tariff scheme could pay back double your spend if you installed before 12 December. For example, a £12,000 system could have net £27,500 over 25 years.

However, the Government announced in October that it planned to cut feed-in payments from 43.3p per kWh to 21p per kWh, slashing typical earnings and savings from £1,190 to £640 a year.