Already extremely concerned by the growing evidence for ‘human-caused’ climate change, Prof Mackay’s course taught me some astonishing facts, such as how the amount of solar energy delivered to the Earth is ten thousand times the total amount of energy we use over the course of a year.   He made me realise that human civilisation has a huge amount of work to do to halt its greenhouse emissions, but he also gave me the hope through new technologies, we really can wean ourselves off fossil fuels without impacting our quality of lives too severely.

After a PhD and several years working in solar photovoltaics for a large company in Germany, I returned to the UK and was astonished to find that the Government has extremely low ambitions for solar energy and even more astonished that it is using David Mackay’s analysis, at least in part, to justify this.  At present, the Treasury’s £360m cap on Feed-in tariffs means that support for solar PV at all scales will end by mid-2012 and limit solar PV capacity in the UK to less than 3% of Germany’s current installed base.

When I re-read Mackay’s key book ‘Sustainability Without the Hot Air,’ I find it paints a very compelling argument for solar energy.   Prof Mackay repeatedly points out that solar energy can deliver far more energy than any other renewable energy technology in the UK, as illustrated by the fact that the amount of solar energy we receive in the UK is fifty times the total amount of energy we use, including transport and heating.  At the time of writing, David Mackay singled out two hurdles for widespread solar adoption in the UK; cost and space. It seems as though these hurdles have been interpreted by the Government as insurmountable barriers, whereas careful re-examination of these hurdles using up-to-date figures reveals them to be significantly less onerous than Mackay first assumed.

In relation to costs, David Mackay states ”it will be wonderful if the cost of photovoltaic power drops in the same way that the cost of computer power has dropped over the last forty years.” This is exactly what has been demonstrated over the last 5 years.  Jenny Chase, a solar energy analyst at the research firm Bloomberg New Energy Finance claims “In 2011 we expect an oversupply of solar panels which will put continued downward pressure on system prices.” In his book, David Mackay uses a solar electricity cost of €0.25 per kWh which is 4 times current wholesale electricity costs, but only twice the price of retail electricity, and seeing as prices have continued to fall exponentially since the time of writing in 2008 we can expect this gap to be closed fast.  In fact, the cost of solar energy is falling much faster than that of any other energy technology to the point where it is the expected to compete with unsubsidized retail electricity prices in UK latitudes by 2014/2015¹.  In contrast, the cost of nuclear energy has risen 5 fold since 1970 according to a recent study by Yale University’s Arnulf Grubler².  By supporting the solar industry now, it will soon be able to support itself without subsidy.

Digging deeper into the Government’s original modelling of overall ambition for PV, the Renewable Energy Association has found that a mid-range future fossil fuel price scenario was used which assumes a cost of $80 per barrel of oil in 2020 (which is unlikely considering current prices are frequently above $100).  By using such unrealistic forecasts, the value of investment in solar energy is being systematically undervalued.

The second issue that Prof Mackay raises is with the amount of area required to get large amounts of solar energy.  Whilst there is a vast amount of solar energy available to us in the UK, that energy is disperse, meaning you do indeed need to cover a considerable area in solar panels to cover our electricity needs.  Prof Mackay points out that to get our current electricity (50 units of electricity per person per day) needs would require 200m² per person.  This is a huge amount of area, but it’s important to realise that reaching that target is highly plausible.  The total amount of roof space per person in England is 47m², domestic gardens 114m², and roads and open spaces make up 60m² and 2300m² per person respectively³, so by using a proportion of roof space and a small proportion of open space we could certainly get close to 200m².  Its important to point out that open space does not mean prime farmland, there are many brown field sites that could be put to good use.  Nor do solar panels on open space prohibit the use of that land for other means.  When placed in fields for example, solar arrays can still permit some animal grazing and in other countries, solar arrays are often positioned along motorway banks or as canopies above car parks.

Obviously getting between 100m² and 200m² of solar panels per person in the UK would be a gigantean undertaking and one that would change the look of our country, but this would be just one of a long line of gigantean undertakings that have taken place in our history.  The expansion of organised farming, the construction of road and rail networks, and more recently the construction of electricity and mobile phone grids were all projects that have profoundly changed our country and its appearance.  Just because the task may be large, does not make it impractical.  In the UK we happily resurface 60m² of road per person every 5-10 years.

Solar energy has already proven itself highly popular in the UK.  It is one of the few technologies that can be produced effectively on a domestic scale giving power to families to generate their own electricity.  Solar energy can also be deployed staggeringly quickly.  In 2010 alone Germany installed 8GW of solar energy distributed among over 200,000 individual installations.  That is equivalent to over two nuclear power stations, and there is no way those nuclear power stations could be built so quickly.

There is a misconception that micro-generation does not result in large amounts of energy, but multiplied thousands of times, the amount of energy we can harvest from small solar installations is enormous.  The UK will of course need a balanced mix of different energy technologies, but lets give solar its rightful place alongside the other major forms of energy generation.  As Prof Mackay points out; ‘to complete a plan that adds up, we must rely on one or more forms of solar power. Or use nuclear power. Or both.’

Dr Toby Ferenczi is Chief Technology Officer of Engensa and a member of the Renewable Energy Association’s Solar Energy Steering Committee.

1. AT Kearney Report; ‘The True Value of Photovoltaics for Germany’ 2010
2. Arnulf Grubler, Yale University; ‘The costs of the French nuclear scale-up: A case of negative learning by doing’ Energy Policy, 2010
3. Department for Communities and Local Government, Land Use Statistics (Generalised Land Use Database) 2005, www.communities.gov.uk/publications/planningandbuilding/generalisedlanduse

Secure, low-carbon and affordable energy requires investment of £250bn, in electricity alone, if the Coalition is to meet the target of providing 30% of energy from renewables by 2020. This target is in danger of not being met due to lack of action being taken now to invest in a future smart grid that can intelligently connect users and suppliers.

Prof. Roger Kemp from the Institution of Engineering and Technology said: “The report takes a simplistic view of the subject and plays down technical issues. It refers to offshore turbines as having ‘very low running costs’ without factoring-in the potential routine maintenance of large structures in a highly aggressive environment and the lack of significant long-term operational experience in areas like the North Sea.

“When talking about wave energy, the report assumes that the limiting factor in adoption will be economics, while we consider that technical viability could be equally important.

“Demand response will have a central role to play, but the challenge of moving from the current ambition for smart metering to a smart grid with full public involvement is only hinted at.  The need to engage the public is crucial.”

There are many engineering and social issues to be resolved before the optimistic ambitions contained within this report can be achieved.  Its publication coincides with the publication of the government’s infrastructure adaptation report and combined they highlight the extent of the engineering challenges and opportunities presented by climate change.

www.theiet.org

A Westcountry law firm has created a new dedicated team to provide specialist advice on the renewable energy sector for the region’s farmers, land and property owners.

With the rapid growth in this market and the South West designated the UK’s first Low Carbon Economic Area, Stephens Scown has taken the step of appointing Sonya Bedford (pictured) as its new Head of Renewable Energy.

The specialist group, made up of experienced property, corporate and planning lawyers, are able to give legal advice on a range of matters including agricultural tenancies and compensation for loss of farming activities, options, leases and contractual issues.

The announcement comes as the firm, which has offices in Exeter, Truro and St Austell, launches a new specialist guide on solar energy, aimed at farmers and landowners, available on its website.

The sector is estimated to contribute around £215 million to the economy every year – many farmers and landowners are being approached by renewable energy providers and might be considering diversifying or supplementing their income, following the introduction of feed-in tariffs earlier this year.

Commenting on the new team, Sonya Bedford said, “Increasingly we’re acting for clients with a really diverse range of needs in the renewable energy sector – this includes local farmers and landowners, domestic property owners, major wind farm developers and operators, as well assisting villages or communities across the region to install wind turbines or solar panels. We are also involved in advising on property issues surrounding the Wave Hub site in Hayle.”

She added, “Working with local planning experts, accountants and other financial advisers, it makes sense to bring together all our expertise in one place to provide a more rounded service for clients. Here in the South West, because of our geographic position we’re really lucky to be able to harness the natural energy that surrounds us and renewable energy is ideally suited to rural areas.”

Sonya is an experienced senior agricultural and commercial property lawyer and is a member of Stephens Scown’s rural team. She is a Member of the Agricultural Law Association, a member of Regen SW and a Professional Member of the CLA and Member of Women in Property.

She added, “Landowners can reap the financial rewards that renewable energy brings but it’s equally important that people get the right advice to protect their assets. It’s a development area that many people are starting to explore, but can be easily caught out by the small print or enter into agreements without seeking proper professional advice.”

For more help or advice on renewable energy, contact Sonya Bedford on 01392 210700 or email s.bedford@stephens-scown.co.uk or visit www.stephens-scown.co.uk

Copy ends

September 28 2010

For more information contact:

Ryan Martinez
Deborah Clark Associates
Tel: 01208 77900
ryan.martinez@dca-pr.co.uk

Feed-in tariffs work by offering fixed, premium rates for both the energy generated from renewable systems (which is then fed-back into the grid), and the energy used. When first introduced by the Department of Energy and Climate Change (DECC), it was with the intention of incentivising investment in green energy by off-setting the costs of installing renewable energy systems by creating long term, guaranteed yields from the projects. Emulating schemes applied successfully abroad, it seems that in the first 6 months of operation, the tariffs have certainly been effective as a means of boosting renewable installations across the UK.

In order to get the UK grid network fully up to speed with the complex requirements of a low-carbon economy, the Sustainable Development Focus Report also published its proposals for updating the country’s network. Working on a framework of Revenue= Incentives+ Innovation+ Outputs (RIIO), Ofgem is planning on generating £32 billion of investment much needed to upgrade a UK national grid not yet ready for green energy and the mechanisms set up around it.

Alistair Buchanan of Ofgem wrote in a foreword to the report,

“This is the biggest change to the regulatory framework for 20 years and sets the network companies on a path to playing their full role in the transition to a low-carbon economy while delivering value for money for all consumers.”

Examples of well known solar distributors in the UK are Dulas, Segen, Solar Century and Waxman.  Because the UK solar industry is so small and so new however, these UK wholesalers are very small compared to their European counterparts in Germany, Spain and France.  One of the biggest solar distributors in Germany, IBC Solar, will sell 500MW of solar equipment this year.  This compares to a total expected UK market size this year of 60MW! So IBC Solar sells nearly 10 times the total UK market, and is just one company!

Unsurprisingly, since the UK is now seen as an interesting emerging market in the solar industry, many of these large European distributors are moving over here.  I spoke to one last week that is investing 200 thousand pounds this year to set up a warehouse and employ a 5 person team to address the UK market. This is good news for UK installers because they will now have access to pricing that was only previously available to their counterparts in mainland Europe.  The UK wholesalers on the other hand may struggle to compete with such large competitors.

Competition is coming from all sides however, and there are now solar panel manufacturers who are moving downstream and becoming more like wholesalers. It is now possible for smaller installers to buy directly from a few of the European manufacturers, thereby bypassing the wholesalers and their margins.  To withstand this competition the big European wholesalers are trying to gain advantage by developing an array of advanced support services for wholesalers to win them over.  This includes things like credit lines, training and design software.

It is unclear whether these features will suffice since there is also competition from the big in-house installers.  In the US there is a very large installation firm called SolarCity which is going head to head with the wholesalers for marketshare, but does all installations using its own in-house team.  This has advantages in-terms of pricing and quality of service – there are no middlemen and they can guarantee the end to end service – the drawback is that growth is capital intensive and slow.

The market is evolving so rapidly it remains to be seen which business model will win out in the long run, what is clear is that there will be a lot of movement in the market – all of which is good for customers since it means prices will fall and customer service will improve.  So when choosing a solar panel system, try to find out where the installer buys their solar panels from, not just who the manufacturer is.  This will help you tell if you are getting a good deal or not.

Currently the UK feed-in tariff is not set to be reviewed until April 2012, with changes possibly not coming in until 2013.  In most feed-in tariff markets, the tariff decreases annually, so not changing our feed-in tariff for two whole years is too long in my opinion.  The feed-in tariff at today’s PV prices provides a fantastic return on investment. 9-12% annual return for 25 years beats nearly everything you could get in an ISA or other savings product.  In two years time, with another two years of cost reduction, the investment return could be significantly higher than it is now.  Frankly, as someone who works in the solar industry, I say that this would be a bad thing.  What the industry needs to see is steady year on year growth, not a boom and bust.  The tariff is fine where it is for now, but soon it needs to be decreased to ensure the returns don’t get too high.  The returns are high enough to trigger major growth in the industry, if they are too high then we will see more and more people pile into the market in a way that is unsustainable.  The tariff would then have to be cut very significantly to control the market, which would lead to a massive drop-off.

It is very important that the industry has visibility on what will happen to feed-in tariffs so businesses can plan ahead.  To solve this Germany have announced what will happen to the feed-in tariff based on the results of the previous year. That means that if the market reaches a certain size, the egression the following year will be larger and vice-versa. The details of this are published so that everyone can see what the degression rates could be – we need this level of visibility in the UK.

Another big problem with feed-in tariffs is that they cause a surge of installations in the run-up to a feed-in tariff degression – which is not particularly healthy.  What would be best is to decrease the feed-in tariff little and often, so there are no sudden jolts to the industry.  Italy has just introduced quarterly feed-in tariff degression i.e. decreasing the feed-in tariff every 3 months instead of once a year.  I think this is a great idea.  As long as the degression each quarter is small and planned ahead, the industry will be able to continue to grow steadily without the need for big every year or every two years.  France on the other hand are considering an annual cap to the PV market.  This is absolutely terrible for the industry as it limits everybody’s growth and will cause redundancies across the industry in France if it goes ahead.

So now we are back on our feet in the UK, lets think about how to create a stable solar industry going forward by decreasing the FiT in a sensible way.  It could be that we follow the Italians lead on this one.

At a time when all members of the coalition government are bemoaning cupboards barer than those of Old mother Hubbard it is perhaps not particularly surprising that Energy Secretary Chris Huhne has been urged to safeguard investments in British renewable energy.

The feed-in tariff which was introduced back in April works by offering guaranteed, premium rates for energy produced by small scale renewable generators. While Huhne has come out and said that, “There is no money left”, he has at least until now talked a good game about supporting green energy in this country. Feed-in tariffs have been absolutely crucial in solar pv taking off in the UK and the future success of UK solar undoubtedly relies on the existence of a strong tariff scheme.

Fearing cutbacks which would cause irreversible harm to burgeoning UK renewable energy businesses, Friends of the Earth (FOE) have carried out their own report designed to show that maintaining and encouraging a strong renewable energy industry has distinct advantages for the struggling e News of spending cutbacks have made depressing reading over the last six months as the government is seeking to rein in spending as a way of controlling spiraling national debt. Health, education, policing and defence have of course been at the forefront of controversy regarding spending reviews and the inevitable consequences which arise as a side effect. Now it is unfortunately renewable energy’s turn to feel the squeeze as some call for cut backs in green energy incentives.

At a time when all members of the coalition government are bemoaning cupboards barer than those of Old mother Hubbard it is perhaps not particularly surprising that Energy Secretary Chris Huhne has been urged to safeguard investments in British renewable energy.

The feed-in tariff which was introduced back in April works by offering guaranteed, premium rates for energy produced by small scale renewable generators. While Huhne has come out and said that, “There is no money left”, he has at least until now talked a good game about supporting green energy in this country. Feed-in tariffs have been absolutely crucial in solar pv taking off in the UK and the future success of UK solar undoubtedly relies on the existence of a strong tariff scheme.

Fearing cutbacks which would cause irreversible harm to burgeoning UK renewable energy businesses, Friends of the Earth (FOE) have carried out their own report designed to show that maintaining and encouraging a strong renewable energy industry has distinct advantages for the struggling economy.

Campaign director for FOE, Craig Bennett said,

“It’s absurd that the Treasury is even reviewing FIT payments because the scheme isn’t financed by taxpayers, and there is already a planned review in two years time. Huhne must stand firm and allow councils, communities and businesses to benefit from green energy revolution.”

The real benefits of feed-in tariffs will be put into perspective in a couple of years when we are able to retrospectively assess the growth of UK renewable investment and uptake compared with our European counterparts. While there are some who may argue that a cash strapped government could better spend its money elsewhere, it is hard to deny that a strong green energy industry would be a vital both for revitalising the economy and helping homeowners make savings on utility bills.

The offer will include both a technical survey to ensure that the property is suitable for solar panel installation and of course the actual installation, taking away the initial start up costs which often act as a deterrent to potential renewable installers.

100,000 systems will be given away to homeowners with south-facing roofs meeting the requirements of the survey, allowing them to enjoy all of the benefits of a solar panel system without having to outlay all of the initial costs associated with solar technology.

Solar panels could save homeowners up to 40 per cent on their electricity bills with estimates that a typical 3 bedroom semi could save up to £250 a year, with the added benefit that homes with solar panels installed fetch a higher price on the market than comparative properties without. A spokeswoman for Homesun commented,

“There’s real excitement about what we are doing. This just goes to show the latent demand for solar amongst the British public, they just needed to find a way to access it. Solar now makes perfect sense. I am proud HomeSun is leading the charge to take solar mainstream.”

Homesun have already announced that since the release of their offer, they have received 7,000 calls and have had 10,000 people log onto the Homesun website. Talking about the unprecedented level of interest, Chief Executive of Homesun David Green said,

“The phones have been absolutely mental and it’s put huge pressure on our website. We were not anticipating such enormous demand. It’s clear that for the first time, we have allowed renewable energy for residents to break through.”

Homesun’s offer has been made possible by the introduction of feed-in tariffs, government legislation introduced in April 2010 devised to increase the take up of renewable energy generation. The tariff works by offering premium, guaranteed rates for both the energy used and the units of energy fed-into the national grid from the renewable systems.

Homesun will therefore be able to recoup their initial investment and subsequently make a healthy profit on each installation. Homeowners will be given the opportunity to buy the tariff contracts from Homesun in the future but it is more likely that most will simply opt to make savings on their bills.

With offers such as Homesun’s making an impact in the media and the building of consciousness about the feed-in tariff, it is very likely that before long the market will be jam packed by suppliers offering very similar solutions

However, plans are afoot to revitalise the stricken Greek economy with the announcement yesterday that 12 billion euros will be invested in green projects in an attempt to create jobs in new renewable industries. In a press release issued by the Greek government, Tina Birbili the Environment Minister said,

“The ministry hopes the programme will decisively contribute to face recession and lead to dynamic economic growth”

Birbili believes that renewable projects could attract around 32 billion euros of investment from around the world creating up to 192,000 jobs. This will at least come as a glimpse of light in a country where unemployment is steadily on the rise and national debt is at an all time high. The EU bailout, funded largely by Germany expires in 2 years, by which point Greece will be hoping that the economy is back on track.

Both Gordon Brown and Barack Obama have been keen exponents of renewable energy as a means of kick-starting the struggling economies of the UK and US respectively. Sound bites such as ‘Green New Deal’ have regularly appeared in the press both sides of the Atlantic in a reference to the government projects of the 1930’s designed to boost recovery after the Great depression. It seems that Greece is going to follow this lead with a number of projects now in the pipeline.

Certainly, with Greece already falling behind other southern European countries with regards to its renewable energy uptake, the investment could provide the vital impetus needed to get the renewable energy industry in Greece on its feet. With targets of generating 40 per cent of its energy from renewable sources by 2020, they have their work cut out.

However, the Committee on Climate Change (CCC) has delivered a warning suggesting that cut-backs in government spending on low carbon initiatives could see the UK fall behind competitors in the green energy industry.

The CCC, which advises the government on meeting carbon emission reduction targets both in the short and long term has stated that the government should re-think cutting £34 million from renewable energy projects including wind, biofuel and geothermal energy. Indeed the CCC believes strongly that more investment should be made in green projects to ensure the long term viability of the British renewable industry.

With Department of Energy and Climate Change (DECC) announcements confirming that certain grants for green projects will be cut, it certainly gives a slightly worrying indication that more cloth cutting could be taking place over the next 12 months. With this in mind, the CCC has highlighted the keys areas in critical need of continued government support:

·          Offshore wind

·          Tidal & wave power

·          Carbon dioxide capture and storage

·          Cleaner aviation

·          Electric vehicles

·          Smart power grids