INDUSTRYOVERVIEW
Confusion reigns in UK market
The confusion and uncertainty in the UK photovoltaic (PV) and solar industry continues as subsidy decisions remain in the balance. David Ridsdale reports.
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ny hopes that a decision would be reached on government subsidies or policies in a timely manner have been dashed with the announcement that the Department of Energy and Climate Change (DECC) has taken its fight over Feed in Tariffs (FiT) review procedures to the Supreme Court. This is the final effort to reverse the Court’s decision that acting two weeks before the consultation process was due to complete was illegal. Market confidence has been further dampened by the realisation that the government may attempt to retroactively change FiTs on incumbent PV projects. DECC has confirmed they will proceed with the challenge but refused so far to provide details of the grounds for its appeal.
The messy and protracted legal battles have sadly cast a shadow over what was a most remarkable year for the UK industry. Nobody was tipping the size of the installations and rapid growth that the region saw in 2011. The overall market passed 1GW in power only a couple of weeks ago, meaning the industry has grown more than 40 times since the FiT was introduced 22 months ago when the entire region boasted 28MW of installed solar energy. Even the most optimistic only expected a few hundred MW and the achievement has seen the UK shoot up the global rankings of regional market places. Despite the heady growth, a balancer is found in Germany’s achievements of installing a further 7.5GW of solar energy despite the reduction of their FiT scheme.
The dramatic success of the industry is the main reason the government has acted against the FiT programme as it has. The programme has far outstripped the budget set aside for the scheme and with austerity being the current global direction there simply wasn’t enough money in the pot. In general most people agree there is an economical and realistic need to ensure the FiT better reflects the available resources. Despite the reasoning of the Government in reigning in costs, many companies developed business plans based on the Government promises and they also have a right to be treated fairly and in a professional legal manner.
The Government has not hidden its desire to reduce the number of players in the UK industry but has unfortunately tried to suggest that the problems faced are caused by unscrupulous chancers out to take advantage. Whilst there is plenty of evidence of ill prepared or poorly trained companies and
individuals marring the industry’s name with shoddy equipment and work, it is unfair of the government to try and paint such a negative industry perceptive. The existence of such industry cowboys points to a lack of regulations and safety checks in the first place. There was plenty of evidence, both anecdotal and factual, from around the world as to what happens without proper safety regulations and understanding of the challenges solar brings. A most simple example is the amazing assumption by many that electricians and roofers could transfer to installing PV with minimal or no training. Remarkable considering PV requires knowledge of the more dangerous DC flow rather than the AC electricity that is used. As one electrician said to me, ‘nobody even had a DC voltage meter when solar came along.’
Statistical disagreement
Not everyone in the industry has built their plans to rely so heavily on subsidy but you would be hard pressed to hear the voices of the understanding over those that are facing massive risk to their business. The emotive nature of the current disagreements means that both sides are happy to twist and turn when it comes to facts or a longer term view of the challenges the industry faces. The Government continues to face criticism for its fluid use of statistics. Greg Barker, UK Climate Minister, recently presented that he had saved UK tax payers £100 million a year and £1.5 Billion over the life of the panel. This was done in a letter to his opposition counterpart
Barker wrote that, ‘It is very difficult to estimate by how much the installation rate might have increased, since this involves assumptions about demand for PV at the higher tariffs and the ability of the market to respond.’
He went on to point out that, ‘We based our estimate on the increase in installation rate in the six weeks between the launch of the consultation on tariffs on October 31 and the proposed reference date of December 12, which saw 292 megawatt (MW) (over 74,000 installations) more PV installed than in the previous six-week period.’
“Conservatively, we assumed that there might be an additional 200 MW installed in February
www.solar-pv-uk.com Issue I 2012
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