News

Posts tagged with: Megawatts

Solar thermal heating systems could be something of a common sight on south-facing roofs in the UK with the introduction of a feed-in tariff. Previously, the high cost of solar thermal kits has put off householders wishing to invest in renewable energy generation but with the announcement of the introduction of feed-in tariffs for solar thermal in the UK in April 2011, solar thermal installation is set to become much more attractive.

The government’s feed-in tariff scheme to be called the Renewable Heat Incentive, will work by offering small-scale producers of renewable energy premium rates over a period of around 25 years for units of energy fed back into the national grid. Feed-in tariffs have been successful in countries such as Germany where they have proved to be an extremely effective way of off-setting the high costs of investing in solar power equipment.

Germany saw a massive uptake in all types of solar energy generation with tariff schemes rendering investments viable in the face of competition from traditional fossil fuel sources. For more information on how the tariff legislation is broken down year by year all of the information is available on solarfeedintariff.co.uk

In the UK, the essential figures are that homeowners wishing to invest in a typical £5000 solar thermal kit for their properties can hope to expect healthy returns on investment of around £500 p/a over a period of around 25 years not including the average £100 saving on utility bills per year. Such returns and savings are the basis of the tariff scheme and solarfeedintariff.co.uk is hopeful that these incentives will be sufficient to help the UK solar industry take off.

Through the installation of roof mounted solar panels, the sun’s energy is absorbed by the panel’s in-built technology which in turn is used to heat the water. The hot water is pumped through storage cylinders where it is heated further, providing households with south-facing roofs a good supply of hot water through the summer months and a contribution to water heating energy through the gloomier seasons.

Households aside, the government is also hopeful that the tariff legislation will bring about a grassroot change in attitude towards green energy as a whole and see technologies such as solar thermal become commonplace rather than an exceptional sight in the UK.

Solarfeedintariff.co.uk is already hopeful that with the obvious environmental benefits of utilising renewable energy sources along with the financial incentives built in to green energy schemes, the UK is set to follow in the footsteps of what are generally regarded to be the ‘greener’ nations such as Germany and Sweden. Households and community projects will all be set to capitalise on the feed-in tariff in the coming years with cash savings, investment yields and carbon emission reduction providing ample rewards for investors and communities.

Fund manager Pascal Schuler of Swisscanto, the Swiss banking joint venture has asserted his belief that renewable stock will offer the best return for investors in the post financial crisis climate, certainly when compared against fossil fuel investments. Speaking specifically about the Swisscanto Fund Green Invest Equity, Schuler commented that portfolios based on traditional fossil fuel energy such as natural gas, coal and petro-chemicals would prove to be unsustainable within the next 20 years.

Schuler believes that the combination of fossil fuel degradation along with the global move towards renewable energy in light of international carbon reduction treaties will give green stocks a sustainability which will be robust against market fluctuations.

“Water, solar and wind energy are areas where we invest in the long-term, as there is an over-average growth potential when financing kicks off again. Banks will prefer them when they start lending,” commented Schuler who sees green stocks as a healthy, high yield option.

Investors will be attracted to renewable sectors in countries where there is comprehensive legislation in place to protect investment and ensure a long-term viability for capital injected into new, renewable technology. Many governments have introduced feed-in tariffs as a way of attracting investment by offering long-term contracts to renewable investors with a fixed, premium rate guaranteed for any megawatts fed-in to the national grid. Certainly in Germany, this particular system of tariffs has been an extremely successful way of offsetting the cost of generating electricity by renewable means rather than by traditional fossil fuel methods. Many inside the industry will be hoping for a similar system to be introduced in the UK in 2010 but until then Germany has proved to be a hotbed of green technology especially in regards to photovoltaic (PV) technology.

The Swisscanto green fund, worth around $205 million has already taken an interest in German renewable stock and is looking to build its portfolio in the German PV sector. The fund has plans to invest in German renewable sector companies SolarWorld, SMA and Wacker Chemie and will certainly look elsewhere once other countries have strong legislation in place to kick-start the renewable energy industry.

Schuler finished by saying, “We will continue to invest in this segment but focus on companies which have a strong balance sheet and are able to survive this crisis.”

Sharp Solar announced last week that they will begin to match their photovoltaic (PV) products to individual customer needs in a move designed to meet the needs of the housing trade. Sharp Solar, part of the Japanese electronics company Sharp spoke last week during the Ecobuild exhibition in London and reaffirmed the massive popularity of Solar roofing systems. Sharp Solar announced that interest in PV systems has grown dramatically and that Ecobuild has also highlighted a growing desire from businesses to reduce their carbon footprint and of course hopefully benefit from government schemes which will come in to lay in 2010

The new PV systems will be part of a bespoke service which will allow a choice of colours and more importantly, can be installed on roofs more easily making the possibility of future retrofitting much more convenient as the systems can be locked in to place on brackets. The new ‘Slot and Play’ system which was exhibited in Earls Court last week will offer value to new low carbon projects across the UK where buildings are fitted with the latest PV technology.

Key to the success of companies such as Sharp Solar is the highly popular feed-in tariff, due to be introduced next year by the UK government. Members of the industry have, since November’s Energy legislation and the creation of the Energy and Climate Change department been highly supportive of the tariff system as they believe it will give a much needed kick start to renewable investment as it has done for example in Germany.

Solar Sharp have given their backing to the ‘We Support Solar Campaign’ along with other leading members of the industry, providing a lobby which is seeking to push solar to the forefront of the energy debate and seek key government legislation and funding which will be paramount to the initial success of investment in Photovoltaic technology in this country.

The crucial factor in the success or failure of the solar industry will of course be the feed-in tariff, designed to spur the growth of investment in the renewable sector by guaranteeing long-term, healthy yields to investors. The long-term contracts set a fixed, above market rate for megawatts fed in to the national grid by small (systems under 5MW), green energy producers. The fixed rate for the renewable energy is paid by the power companies, the additional costs of which are absorbed by all consumers adding a small amount to monthly utility bills. Certainly, in order to keep apace with the infrastructure of areas such as Germany and California many believe that the government should set a rate of around 50p/kWh unit generated and the ‘We support Solar Campaign’ will make this clear when they produce their research findings to the government at the end of March.

Regarding the possible findings of the report, Andrew Lee of Sharp Solar commented,

“I can’t pre-empt what it is going to say, but there’s a lot of work being done on feed-in tariffs. There are a number of different options how feed-in tariffs would work, and certain job creation scenarios. There could be 300,000 to 400,000 people in this market if the feed-in tariff is fit for purpose.”

Glass and plastic component manufacturer, Romag who specialize in the production of units to be used in photovoltaic technology have developed a product designed to recharge electric vehicles in public spaces using solar panels. The ‘PowerPark’ facilities will be located in areas such as supermarkets, petrol stations, schools, offices and airports and will generate enough electricity via their PV canopies to both charge electric vehicles and feed energy in to the national grid.

PowerPark, which is set to be rolled out first in the North East and then the rest of the UK has already secured a contract with OneNE, a regional development agency created to help projects such as this in the North East of England. The regional development agency will also help Romag to set up the UK’s first photovoltaic training and development park, in the hope that it will see the development of other renewable projects which will help contribute to the general move away from fossil fuels in the UK.

Although as yet, electric cars have failed to enter the national consciousness the industry hopes that in the next few years, based on the provisions set out both in the Energy Bill land by the newly created Environment and Climate Change Department, they will become much more popular after 2010. Many commercial renewable manufacturers such as Romag are also hopeful that the feed-in tariff (FIT) which is to be introduced next year will help them by offering them a fixed rate for the megawatts they feed-in to the national grid via their PV canopies. As has been practiced successfully in places such as Germany, the tariff helps manufacturers and investors alike as their revenue streams are protected by the rate paid for the megawatts by the energy companies. The additional costs incurred by the power companies in purchasing the expensive renewable energy are spread across the consumers in their monthly bills.

There are hundreds of businesses in the UK which, like Romag will be hoping that the government’s feed-in tariff is sufficient to spur the renewable industry in the UK the same way it has done elsewhere, in particular in Germany where tariffs have been highly successful in promoting investment in photovoltaic plant.