The move follows the Government’s decision to slash feed-in tariffs on solar installations made after December 12.
Peabody awarded the £18.5m contract to Breyer in July to install solar panels on housing across 25 London boroughs.
A Breyer spokesman confirmed “the contract will now be cut short by mutual consent” from December 12 because it is no longer economically viable following the subsidy cuts.
The contract involved installation of around six megawatt peak of solar panels.
A Breyer spokesman said: “The £18.5m value was a maximum amount if all residents agreed to installations.
“So far we have installed two megawatt peak of solar panels and a realistic amount after consultations with homeowners was about four so we were roughly half way through.”
The original 39 week contract was due to be completed by March 2012.