While critics argue that solar energy has no immediate future in the UK’s famously grey and wet climate, a new report says it could be thriving and commercially competitive there by 2020 without government support. LONDON, 6 December, 2014 − Solar energy is sometimes dismissed as a fanciful idea with little to offer so far in such a cloudy country as the UK, but a new report says power from the sun could thrive in Britain in barely five years’ time − without the need for any subsidy. The report – published on the website of Thema1, a Berlin-based group that works to accelerate the transition to a low-carbon society − says solar energy is leading changes in the power market as hardware costs have fallen relentlessly over the last decade, recalling the boom in the semiconductor industry. Last month, the German utility E.ON announced that it was hiving off all its conventional fossil fuel generation to focus on renewables and energy services. Dr Johannes Teyssen, E.ON’s chief executive, said on 1 December: “More money is invested in renewables than in any other generation technology. Far from diminishing, this trend will actually increase.”
The authors of the new report − energy expert Gerard Reid, founder of the corporate finance company Alexa Capital, and Gerard Wynn, of the GWG Energy climate policy and energy consultancy − say it was written in the context of the UK’s plan to force large-scale solar projects to compete with onshore wind for a smaller pot of support, which they say will seriously undermine that market. Solar power, they predict, would be competitive without subsidies as soon as 2020 in the British commercial rooftop market, which includes schools and offices. The domestic rooftop and large-scale solar markets would be economic within the next 10 years. “We are firmly convinced that solar will become the bedrock of the global power system going forward,” said Reid, whose company finances low-carbon energy projects in Germany and the UK. “That said, the road going forward is uncharted and difficult. Our message to the UK Government is to reduce support for solar, but to do so gradually.”
“As battery costs fall, households will be able to deploy solar panels without government support”
Once all support is withdrawn, domestic solar power will critically depend on households increasing the amount that they consume, rather than exporting it to the grid. In this way, they will avoid selling surpluses at very low wholesale power prices, while buying less mains electricity at much higher domestic power prices. Batteries could be important, allowing households to consume their own stored power for several hours after sunset − a critical factor in the British domestic market, where peak demand is in the early evening. “As battery costs continue to fall, households will be able to deploy solar panels without government support,” Wynn predicts. The report says batteries could reduce payback periods for homeowners to little more than a decade by 2020. But it adds that these are not the only people who can look forward to a windfall: the three markets in solar power – large-scale “solar farms”, and commercial and residential rooftop users – will become economic in the UK without subsidy within the next decade.
Critics of solar power say it cannot provide the consistent supply of power modern society needs − a charge that has proved mistaken − and that it can do nothing at this stage of its development for a famously grey and wet country like the UK. The UK Government’s former Environment Secretary, Owen Paterson, who lost his job last July, told a London audience in October: “Solar power may one day be a real contributor to global energy in low latitudes and at high altitudes, and in certain niches. But it is a non-starter as a significant supplier to the UK grid today and will remain so for as long as our skies are cloudy and our winter nights long.” He added: “It’s an expensive red herring for this country, and today’s solar farms are a futile eye-sore, and a waste of land that could be better used for other activities.” Germany’s experience, and the prospects for the UK, may give him cause to think again. − Climate News Network