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The UK has dropped down the Ernst & Young global clean energy table to be overtaken by Italy as analysts question the Government’s flip-flop support for renewable energy.

For the first time, the UK has dropped outside the top five nations on the global clean energy index following concern that Energy Ministers are shifting their focus toward gas as an alternative to renewables.

And to add to the gloom, investment in clean energy at the start of this year has dropped to its lowest levels since 2009 according to the latest Ernst & Young quarterly renewable energy Country Attractiveness Indices (CAI) report published today.

The report shows there is good reason for long term optimism in the global renewable energy sector as more mature technologies move ever closer to grid parity. However, the short to medium term sector outlook is generally downbeat as the Eurozone debt crisis and increased competition from Asian manufacturers continues to focus the minds of European policy setters.

The shale gas boom and political resistance to tax credit extensions also continue to pose significant challenges to the US market, the report finds.

The indices scores 40 countries across the world in respect of their national renewable energy markets, renewable energy infrastructure and the growth potential of individual technologies.

The ranking for the UK has dropped from 5th to 6th position, partly as a result of concerns around the UK’s commitment to renewables amid speculation that the Department for Energy and Climate Change (DECC) is considering natural gas to be a possible bridge fuel for the country.

There has also been a re-weighting in the index which takes into account the growing importance of solar within the global energy mix; this has had a negative impact on the UK which is traditionally a wind-heavy country given its strong resource and offshore potential.

The UK’s solar industry also received a fresh blow following DECC’s proposals for another round of Feed-in Tariffs (FIT) cuts in the coming months. However, the renewable energy sector as a whole, and offshore in particular, was boosted by plans to implement a significant spending programme to improve the country’s transmission infrastructure for renewable energy sources.

Ben Warren, Ernst & Young’s Energy and Environmental Finance Leader, explained: “There is significant concern across the green energy sector that the Government will shift its focus towards natural gas as an alternative to renewables. The Electricity Market Reform needs to deliver the right framework to stimulate investment across all forms of energy generation, including renewables.

He adds: “The recently published draft energy bill is a welcomed step in the right direction and signals clear progress, however it is important we clarify certain aspects of the new regime, particularly around the offtake arrangements for independent generators in order to avoid uncertainty for investors.”

To look at the impact on businesses, Ernst & Young commissioned a global survey of one hundred US$1b-plus companies operating within energy intensive sectors, identifies key issues faced at C-suite level. This revealed that 38% of respondents expect energy costs to rise by 15% or more in the next five years. They ranked energy efficiency, increased usage of renewable energy and growing energy self-generation are the themes driving corporate energy mix strategy discussions.

While reducing costs through energy efficiency measures is often the foremost objective of an energy strategy, a number of other subsidiary goals are also crucial, such as energy security, carbon reduction, and price stability; with regulatory compliance and reputational aspects also playing a part.

As the largest global corporations tackle the challenge of transforming to a low-carbon and resource-efficient economy a variety of technologies are being deployed. These include energy demand management (47%), building energy management systems (20%), energy-efficiency lighting (18%) and building automation (18%).

The survey also found that 41% of respondents generated some form of renewable energy with company-owned or controlled resources such as solar, wind, or bioenergy. However this practice is not yet widespread with only around one in ten reporting that clean company-owned energy accounts for more than 5% of their total energy production.

On the renewables contribution to energy generation, Warren commented: “While company-owned generation clean energy is low, 68% of respondents purchase some amount of electricity generated from renewable sources. However only 39% of all respondents would be willing to pay a premium for renewables, highlighting the importance of achieving grid parity and developing innovative project financing models.”

Warren added: “The main barriers to self-generation and renewables adoption are mainly related to risk and financialreturn. This suggests that adoption could come even faster with financing innovations and increasing cost-competitiveness of renewables. Only those businesses with a comprehensive and diverse energy strategy will be able to create and maintain competitive advantage in the resource-constrained world of today.”


(originally posted on Click

After weeks of anticipation the Department of Energy and Climate Change (DECC) has today published the results of the latest solar feed-in tariff consultation. From August 1 the new rate for 4kW systems will be 16p/kWh, set in line with current installation figures.

With installed prices now more than 50 percent lower than in April 2010 when the FiT was first introduced, the latest tariffs are aimed at providing the same returns as originally set out.

Speaking in the House of Commons this afternoon the Minister of State, Greg Barker announced a range of alterations to the existing feed-in tariff (FiT) scheme. The UK solar industry will now benefit from a less complex degression management model, which includes smaller quarterly degressions linked to market deployment. This differs from the existing system, which offers an automatic degression.

As expected the new tariffs [seen below] will go ahead from August 1, one month later than originally planned. After noting lower-than-expected installation rates the Department decided to hold off on cutting the tariff until the market begins to pick up.

Band (kW) Standard generation tariff (p/kWh) Multi-installation tariff (p/kWh) Lower tariff (if energy efficiency requirement not met) (p/kWh)
•4kW (new build) 16.0 14.4 7.1
•4kW (retrofit) 16.0 14.4 7.1
>4-10kW 14.5 13.05 7.1
>10-50kW 13.5 12.15 7.1
>50-100kW 11.5 10.35 7.1
>100-150kW 11.5 10.35 7.1
>150-250kW 11.0 9.9 7.1
>250kW-5MW 7.1 N/A N/A
stand-alone 7.1 N/A N/A

The tariff for a domestic solar installation will now be 16p/kWh, down from 21p, and will be set to decrease on a three-month basis by 3.5 percent thereafter. These degressions are expected to be delayed if the market slows down. Uptake will be viewed in three different bands (domestic (size 0-10kW), small commercial (10-50kW) and large commercial (above 50kW and standalone installations). Quarterly reductions will be determined within those bands.

The new tariffs, which will now be paid over 20 years instead of 25 years, should give a return on investment (ROIs) of over 6 percent for most typical, well-sited installations, and up to 8 percent for the larger bands.

Investor income will also be boosted by the increase in the export tariff, which will increase to 4.5p from 3.1p. This will be particularly beneficial for large-scale solar investors, who will be able to add the export tariff to the feed-in tariff in order to generate a reasonable return on investment. All tariffs will continue to be index-linked in line with the Retail Price Index (RPI).

DECC also revealed that organisations with more than 25 solar PV installations will get 90 percent of the standard applicable tariff, increased from the 80 percent proposed in February. This increase reflects new evidence heard on costs involved for these projects.

Although reduced, the new rates are aimed at kick-starting the UK solar market, with an aim of installation at least 800MW in 2012/13. In fact, DECC expects that these rates to provide the resources for the UK to achieve 800MWp to 1,000MWp each year to 2015, with an extended ambition for 22GW for 2020. These figures account for solar capacity to be installed in each year than the original FiT budget offered over five years, reflecting the strong growth the industry achieved in 2011.

These figures do not include larger projects that are now able to use two ROCs; it is suggested there could be a further 300-600MWp installed under this mechanism before April 2013.

“Today starts a new and exciting chapter for the solar industry. The sector has been through a difficult time, adjusting to the reality of sharply falling costs, but the reforms we are introducing today provide a strong, sustainable foundation for growth for the solar sector,” Barker commented.

“We can now look with confidence to a future for solar which will see it go from a small cottage industry, anticipated under the previous scheme, to playing a significant part in Britain’s clean energy economy.

“I want to send a very clear message today. UK solar continues to be an attractive proposition for many consumers considering microgeneration technologies and that having placed the subsidy support for this technology on a long-term, sustainable footing, industry can plan for growth with confidence.”

Alan Aldridge, Chairman of the Solar Trade Association said: “We broadly welcome many of the Government’s decisions for how solar PV will be treated in the FITs scheme and wholeheartedly welcome the inclusion of Solar in DECC’s updated Renewables Roadmap; this should reassure consumers and solar companies alike that the Government recognises and stands behind a major role for the solar industry.

“Despite the currently slow market, the industry can have some confidence that the new Tariffs are tight but workable. Householders should be reassured the new Tariffs will provide more attractive returns than can be found elsewhere today. The STA is now keen to work with Government to get this positive message out.”

The Minister also announced plans brought forward by Cornwall Council and the Building Research Establishment to set up a National Solar Centre in Cornwall.

Cllr Alec Robertson, Leader of Cornwall Council said: “The FiTs scheme allowed many people across Cornwall to learn about renewable energy, especially solar power, and Cornwall would welcome the establishment of a new National Solar Centre that  will be at the heart of the bright future for PV in the UK. We’re pleased that DECC has announced changes that improve the predictability for the FiTs scheme”

Although many areas of today’s news will inject an element of confidence into the UK solar market there are still some areas that are expected to cause concern. There is a fear that the August 1 cuts could continue to stall uptake, and that DECC has not accounted for this issue fully within the consultation.


Originally posted on Solar Power Portal.

Solar panel installations have fallen by almost 90% in the weeks since the government cut the subsidy available, according to Department of Energy and Climate Change figures.

The change in financial support for solar power has been highly controversial and has seen the government lose a high-profile legal case in the high court. The new data lends support to the charge of some in the solar industry that the government cut the subsidy too far and too fast, endangering thousands of jobs. Ministers have defended their actions, saying the scheme they inherited from the previous government was poorly set up and was too costly for the energy customers who ultimately foot the bill.

Since 1 April, the amount paid to those installing solar panels fell from 43p/kWh of energy generated, to 21p/kWh. In the three weeks since then, an average of 2.4MW of solar photovoltaic capacity has been added each week – 87% down from the weekly average for the previous year of 18MW.

Greg Barker, the Conservative minister responsible for the solar subsidy scheme, said the changes aimed to end “solar booms” and busts: “The whole point of my reforms is to bring in a much greater degree of certainty and predictability.” He has set an ambition to have 22GW of solar capacity installed in the UK by 2020.

Caroline Flint, the shadow energy and climate change secretary, claimed on Tuesday that this target would take 169 years to reach at the current rate. “For months Labour has been warning that the government’s cuts to solar power would destroy thousands of jobs, cut off a green hi-tech British industry and stop families controlling soaring energy bills. These shocking figures prove that because of the government’s cuts, it will take a staggering 169 years for us to reach our targets for solar power.”

Paul Barwell, chief executive of the Solar Trade Association, said: “We’ve seen drops in installation with every policy adjustment, but we expect this one will take a bit more time to pick up.” He said the reason take-up would take longer this time is the new requirement that homes must be reasonably energy-efficient before being entitled to solar panel subsidies – a requirement met by about half of homes.

“Many householders are aware that government has slashed subsidies,” Barwell added. “The challenge for us is to make householders aware that’s partly because industry has slashed costs, and partly because solar is so popular. There is no doubt that financially solar remains a great prospect for UK homeowners so there is no good reason why the UK market should stagnate.”

All sides agree that subsidies had to be reduced because the costs of solar panels continue to drop rapidly: the argument was about the speed and scale of the cut.

In his first significant remarks on green policy last week, prime minister David Cameron appeared to address the uncertainty caused in the renewables industry by the changes to the feed-in tariff. “When we have made a commitment to a project, we will always honour it in full,” he told energy ministers from around the world on 26 April


Originally published on The Guardian


Here at, we would like to see the government support the solar industry more comprehensively and understand that investment needs concrete figures and not hollow promises to work from. The insistence of energy efficiency within the home prior to the tariff being granted limits the number of rooftops where solar panels can be fitted and damaged growth in the industry.

We hope the 22GW capacity mentioned by Mr Barker is strived for and we would like to see more action to support the decentralization of  energy within the UK

Japan may announce preferential price rates this month for electricity generated from renewable energy in a program that will start in July to encourage investment in non-fossil fuel power plants.

A five-person panel have been discussing the preferential rates, known as feed-in tariffs, since March 6 and will hold their sixth meeting on April 25.

Japan’s Ministry of Economy, Trade and Industry hopes to receive the recommended rates by April 27, which will then need government approval, Keisuke Murakami, who heads clean energy programs at the ministry, said today.

The feed-in tariff guarantees above-market rates for solar, wind, geothermal, biomass and hydroelectric power. The Japan Photovoltaic Energy Association proposed 42 yen (52 cents) a kilowatt-hour for 20 years for solar power. For wind, the Japan Wind Power Association suggested as much as 25 yen a kilowatt- hour for the same period.

Murakami said no decision had been made about rates for solar power in response to a Nikkei newspaper report today that said the rate will be 42 yen a kilowatt-hour for about 20 years. The newspaper didn’t state the source of its information.

By : Bloomberg