SPP talks to Alastair Mounsey, UK country manager at JA Solar, about what to expect from the UK market as it rebounds and what installers can learn from other markets who’ve managed regulatory change in the past.
From the view of a major/ global manufacturer, what is the UK’s market place in a worldwide context?
The total UK solar PV market now installs less volume compared to other major European markets such as Germany and Holland, and will become a gigawatt grid-parity market later than perhaps Spain, Italy or France. But such a market is coming and the increasing trend of electric vehicles and electrification of cities alongside the strong industry infrastructure make the UK a strategic focus for JA Solar. We are fortunate through many years of engagement to have high quality partners to create a deep integration to the market and maintain a dedicated full-time team across the UK and China.
What do you see as the major dynamics of the UK PV market now and near future?
At the moment Scotland is important due to the new build install market, energy efficiency incentives and the desire to bring housing stock up to EPC rating. Across the whole UK there are the beginnings of major schemes such as energy deal roll-outs, often with social housing, and utility companies selling systems or energy. Commercial and high energy users are now starting installations with a mindset beyond feed-in tariffs. For large multi-megawatt, completely subsidy-free sites we see it to be more of a product of 2019 or 2020 as the various PPAs and other structural complexities are ironed out and total build costs come down just a little more.
Have the main market players changed in the last few years?
There are fewer solar installers within the UK but generally they are established businesses that are reliant not on selling the feed-in tariff but instead the benefits of solar and renewable energy in general. These businesses have diversified and often don’t purely rely on solar. What is interesting is some of the ‘Big 6’ energy companies coming back to the market, with one reason being the emergence of battery storage options and the requirement for it. As for the PV supply chain it is increasingly managed by fewer integrated and established companies who add value to projects.
Do you see a natural migration towards BIPV and other more aesthetically-driven solar products?
Northern Europe has always had a high aesthetic focus but the in-roof market has grown rapidly recently with some good variations of solutions available. At a basic level on new-build just the economics of saving the cost of the roof covering can stimulate the installation of an in-roof design. However pure module cost is still also a major driver that we recognise and so JA Solar focuses on our standard polycrystalline lines as well as our high efficiency all-black mono lines and products.
How integral do you feel it is for solar installers to work better with house builders and other construction firms?
Many do this very well already, but it’s also the case that some companies are just not set up to do it and it would be detrimental to their business to try. Indeed house builders and construction firms are generally detached from the solar industry. The message we have to that industry would be to keep the focus on selecting a Silicon Module Super League (SMSL) product and use technologies that are well proven with a track record to ensure they get security and longevity; and consider established supply chain partners who can offer the right pricing, complete kits and technical and post-sales support.
Are their lessons to be learned for the UK market from changes in other global markets?
The end of the boom and bust subsidy cycle and entry to a new unsubsidised market is one that some EU markets took many years to adapt to. The solid parts of the solar market infrastructure and firm legal and financial frameworks in the UK can bring about that change quicker than other markets.
What are the major trends in global module manufacturing that can affect UK players and the market?
The ‘battle’ for cost and domination between Mono and Poly P-type crystalline is a major watching point as certainly over the long term the cost gap could close towards parity. Another point in the medium term is we can foresee companies who have larger global footprints and have managed their capacity growth sustainably to overcome any ‘shake outs’ as the supply chain continues to adapts to the pricing required in grid-parity markets.
What do UK solar installers need to be aware of on the global stage? Be it regulation, manufacturing trends or something else?
The market must still be aware that whilst trade barriers exist in the EU then actions that attempt to circumvent such rules do have real impacts. This can be from ceased goods to even, and the industry has seen it happen, severe legal and financial consequences for both the supplier and all the buyers involved. A serious module company will not expose themselves and their customers to such these risks.
To what extent is grid-parity a reality?
If the question is can solar compete with traditional energy sources, then yes in many countries it is already cheaper. Both from national level energy auctions to completely private contracts PV is proving to be the lowest priced electricity generation source across the world.
What can installers do to accelerate the advent of grid-parity solar in the UK?
The companies we see bridging the gap into non-subsidy reliant projects are those that achieve scale, have brought and convinced the financiers and banks with them and have innovative and solid PPAs for the right profile energy usage customers. Aside from waiting for battery technology to bridge the gap, one revolution at least for flat surface (ground mount or flat roof) are bifacial modules which can produce more energy especially on flat surface installs, with 5-10% more energy yield for the system in the right situations.