Time to end whingeing over solar subsidy cuts

Earlier this month the government announced it was stopping support for large scale (greater than 5MW) solar photovoltaics (PV), to the dismay of the solar industry and green lobby groups. It looked like the government was getting rid of the green “crap”, but if we are to believe the DECC, it was a response to the better than expected success of the Renewable Obligation (RO) policy which it says has encouraged an explosion of PV capacity across the country, with 1 GW (1/3 of total capacity) being installed in 2013 alone. Much of this has been due to solar PV farms.

The appearance of solar farms in the countryside has taken many by surprise, not least due to their rapid construction. In little over a year, the number has grown from 65 to 200 farms, with more planned. There have been howls of protest from locals who regard them as blots on the landscape. In many ways though they are less intrusive than wind farms, providing they are carefully screened their visual impact can be minimised. They do, however, cover a much larger area than wind farms and placed amongst the fields of oil seed rape introduce an industrial edge to the countryside which is difficult to ignore, particularly in the rolling countryside of the west country. Solar farms offer benefits aside from the obvious renewable power generation. If sensitively managed, a solar farm can provide habitats for wildlife, habitats that don’t exist in the often intensively farmed land around them.

While the early withdrawal of the money will disrupt business, there are many other opportunities to use PV, not least the opening up of the roofs of the Government’s estate

Whilst the solar industry and green lobby groups have protested, there is still a lot to be positive about. The PV industry globally is in rude health and the growth areas are no longer in Europe but China and the far east. The UK can install up to 10GW of additional solar without creating control problems for the electricity grid. This figure might be less if demand falls or more if economic growth and electrification of transport and heating continue.

The government has signalled its intention to shift the solar industry towards a focus on the built environment as outlined in its recently published solar strategy. Whilst more expensive on a per unit energy basis when compared to the large solar farms, PV is a natural fit with buildings. PV has the advantage over other renewable technologies in that it is scalable, and easy to integrate across a range of sectors, particularly buildings.

Whilst I can understand the industry’s frustration at the potential early closure of the RO incentive, closure is a result of success and the rapid uptake of a fixed budget. The costs of installing a PV system have fallen by over 50% thanks to improvements across the supply chain and through global competition. While the early withdrawal of the money for PV will disrupt business, there are many other opportunities to use it, not least the opening up of the roofs of the government’s estate. So stop moaning and move on.

Nick Cullen is a partner at Hoare Lea