Solar price reductions no longer dependent on subsidies, says REA
Prices would continue to fall in the UK solar industry even if all subsidies were removed, a representative of the Renewable Energy Association (REA) told an audience at Sustainability Live this week.
“Nothing will stop solar now – even if a new Government came in and said we are going to stop all subsidies tomorrow, the solar industry would continue on,” said the REA’s senior advisor for solar Ray Noble.
“It’s a world industry and nothing will stop the prices coming down and therefore people will be using it.
“But the Government won’t be doing that, they only need to do another three or four years of support and then they will get all the credit for what will be the cheapest form of energy generation.”
Noble’s view supports the Government’s reasoning behind the removal of RO subsidies for large-scale solar (above 5MW) in the UK at the end of March. The coalition has said the solar sector had become successful and competitive enough that taxpayer money would be better spent elsewhere.
However, the industry itself has generally disagreed, claiming the subsidies allowed solar to compete financially with the UK’s coal, oil and gas industries.
The removal of subsidies for large-scale solar prompted an industry ‘gold rush’ as developers worked to beat the deadline. According to the Solar Trade Association (STA), as much new capacity was been installed in the first three months of this year as in the whole of 2014.
But following this subsidy deadline, the organisation expects installations to fall by up to 80% as most firms will not be able to compete.
Stellar Solar Installation’s director Barry Marsh, also speaking at Sustainability Live, agreed with Noble that the solar industry would weather the subsidy removal.
“With the degression process the Government has in place we have a future so long as the new Government carries on which is fairly risk adverse in terms of investment.”
However, a different problem may hinder future solar development in the UK. John Macdonald Brown, Syzygy Renewables’ director, said that a lack of time limitations on grid consent was hindering new projects.
“With planning you have three years to build, but with grid provided you keep the conversation going you can keep it as long as you like, and that is a big, big problem,” he said.
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