The decision by Solar Power Portal to launch its Building a British Solar Future campaign is to be applauded.
Anyone who has been involved in the PV industry in recent years knows all too well what it is like to ride the so called ‘solarcoaster’.
I have a slightly unique perspective in that I have been both a director of a leading renewable energy installer and, now, the founder of a recruitment company that works exclusively in the renewables sector. I have been riding the solarcoaster since 2007.
The one thing anyone connected with the solar industry has learnt is to take nothing for granted. Any quiet period with settled government policies is usually followed by a period of turbulence. You almost wonder if Ministers take some sick delight in watching our sector try to avoid falling over.
And, so, we yet again find ourselves entering a period of uncertainty. Ministers have confirmed the closure of the Renewables Obligation Scheme despite DECC’s admittance that there will be a resulting increase in the amount of CO2 emitted and there is a risk the UK will miss its 2020 renewable energy targets.
It is also currently consulting on changes to the Feed-in Tariff accreditation with the threatened removal of pre-accreditation and pre-registration. In the consultation notice, DECC admits that going ahead with the proposals will mean less certainty for developers who won’t know what tariff they will receive. DECC calls this an “acceptable commercial risk for developers to take”.
The current consultation, due to end in a couple of weeks, is the forerunner of a full review of the Feed-in Tariff later this year.
While the potential impact on those currently working in the solar industry is bad enough, the UK government also seems to be happy to jeopardise a sector which is massively outperforming every other sector in the economy.
Figures produced by the Renewable Energy Association (REA), have shown an 8.7% increase in the number of people working in our sector. In 2012/13, there were 103,033 people employed in the renewables industry, but by the end of 2013/14 this had grown to 112,028. This compared to an overall employment percentage rise of just 1 per cent during the same period.
There are now just over 6,800 companies in the sector, compared with 6,420 the previous year. Just over 2,000 of these operate in the solar PV industry – a reminder of just how important solar continues to be to the overall health of the renewables industry. It is also worth noting that while every other sub-sector saw a net increase in the number of companies, the number of solar PV companies fell by 4% – perhaps a sign that some of the less reputable firms are leaving our industry as the market continues to mature.
Another positive that emerges from closer analysis of the statistics is the strong demographic spread of newly created renewables jobs. We are not an industry dependent on London and the south east corridor. The much vaunted Northern Powerhouse is responsible for almost 11,000 of the jobs in our sector.
This jobs boom did not happen by chance. Instead, it was due to an increasingly confident UK economy – emerging from the worst recession in a generation – and a period when the government stopped tinkering with a young industry trying to find its feet after a number of rocky years of challenging government policy.
In the year since I established my company, Hyperion Executive Search, we have seen strong market confidence, creating many job opportunities which is not only increasing career options for those in the industry, but also for those with transferable skills interested in moving across to the sector.
However, in the last few weeks, this mood of positivity has been jolted with a handful of UK assignments being cancelled and the focus shifting more towards overseas roles, particularly among developers.
With perfect timing, the Renewable Energy Association (REA) has published its latest industry report – UK solar beyond subsidy: the transition.
The report, written by KPMG, confirms that solar PV remains the most popular renewable energy technology in the UK with deployment rising. By the end of March 2015, solar PV deployment had reached 8.1GW. By 2016 it will have risen to 11GW.
The REA recognises that our industry needs to move towards a subsidy-free future but the report makes it clear that “even though less and less direct subsidy and policy support will be required for solar in the coming years, the industry is far from becoming fully self-sustained.”
It is determining the path to a subsidy-free future that is so critical in order to avoid, as the KPMG report suggests, the risk of a “cliff-edge” for the market. A pretty similar story is reflected in the Solar Trade Associations (STA) ‘Solar Independence plan’, showing a glide path to zero subsidy for solar.
The REA and STA have made a number of good recommendations. These include mandatory solar panels for all new buildings; alleviating tax burdens on businesses installing commercial solar on rooftops; greater investment in grid upgrades to encourage more ground-mounted solar; and more support for energy storage.
These recommendations and others like them demonstrate that the renewables sector is very much planning for life after FiT. What we are looking for from ministers and policy makers is a sensible, properly thought out and consistent transition towards a subsidy-free industry.
The growth statistics produced by the REA, some of which are contained in this blog, provide ample evidence of the economic benefits that can be achieved by the renewables sector. We have consistently outperformed the rest of the UK economy in job creation. To avoid jeopardising such strong performance indicators, our industry needs stable, properly thought-out policy, as opposed to policy making that generates a few short-term headlines but could cause long-term damage to our sector.