Bentley Motors rooftop array is the largest of its kind in the UK. But Government policy is restricting the growth of the sector. Photo: DECC via Flickr.com.
Government attacks UK's 'big solar'
13th May 2014
Not only does the Government hate onshore wind, now it's turning against large scale solar. Its latest 'big idea' is to lock projects above 5MW out of the Renewables Obligation, while keeping tight limits on rooftop schemes.
We had forecast solar could be cheaper than onshore wind by 2018, but for this to happen we needed stable policy sustaining a high-volume market.
DECC is consulting on a proposal to close the Renewables Obligation (RO) to 5MW+ solar farm applications from April 2015.
This controversial idea follows recent assurances in the Commons from Energy Minister Michael Fallon that no further changes to the RO were planned.
For all solar over 5MW, the industry is expected to switch to the Contracts for Difference scheme from next year, intended support large scale generators like nuclear power stations.
It's a far more complex and expensive system for generators to operate - so less accessible for the SMEs that are prevalent in the solar sector.
Solar costs down 30% in two years
The solar farm industry has also brought costs down by 30% over the past two years, and solar was on track to be the cheapest source of low carbon power by 2018. But STA says this is now looking uncertain.
"If DECC’s proposals go through, they will severely disrupt the solar industry’s speed of cost reduction. The news still comes as a crippling blow to the future of an industry that has invested 12 months defining and disseminating good practice."
The latest figures from DECC show that in the year to January 2014, solar power accounted for just 1% of the total RO spend. Even a doubling in the UK 'big solar' capacity from the current 2.1GW to 4.2GW would leave the figure under 10% in 2014/5 - hardly enough to justify the proposed measures.
Uncertainty for large rooftop developments
The STA is also bitterly disappointed that DECC is not proposing to increase the 'capacity triggers' for Feed-in Tariffs (FITs). These work by cutting FIT payments to generators once specified volumes of solar capacity have been created.
They therefore create risk for investors and developers as they do know in advance how much they will be paid for their electricity, says STA - making it harder to fund schemes and increasing the cost of capital.
"Despite the Solar Strategy claiming it wanted to see a major increase in roof-mounted solar, DECC is not proposing to correct the major structural problems with FITs, essential to deliver on this goal", said Leonie Greene, STA’s Head of External Affairs.
"By making solar more difficult to deploy at scale than other renewables the Secretary of State is proposing to tilt the whole national playing field against solar power investments.
"The Government says it wants to see a lot of mid-scale rooftops but everyone involved in solar knows the UK policy framework is inadequate. We have been warning DECC they must fix the user-friendly Feed-in Tariffs for medium and large scale projects for nearly a year."
Solar could soon be cheaper than wind - with proper support
STA CEO Paul Barwell said: "We had forecast solar could be cheaper than onshore wind by 2018, but for this to happen we needed stable policy sustaining a high-volume market. The Government is actually moving to slow down solar's cost reductions towards grid parity.
"The industry will be alarmed by these proposals and surprised to be singled out for harsh treatment. If these proposals go through they will knock the industry’s extraordinary progress back, and actually reduce healthy competition in the renewables sector."
The Co-Chair of DECC’s Solar Strategy, Ray Noble, said: "The Coalition appears to be playing politics with solar rather than praising its success in delivering significant amounts of much needed power from safe and secure sunlight.
Strong public support for solar farms
Negative comments made by Conservative Ministers on solar farms are at odds with a YouGov poll commissioned by the STA last summer showed solar farms are the most popular local energy development.
The Government’s own research published last month also found that public support for solar power is the highest it has ever been, at 85%.
The proportion of people who "would be happy to have a large scale renewable energy development in my area" was also high at 59%. Planning approval for solar farms is exceptionally high, averaging 88% since 2009.
Noble comments: "The Government should be backing this incredibly popular technology and taking care to understand its exceptional benefits, including the fact that it substantially reduces transmission losses by generating electricity where it is needed."
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