Chinese tariffs cast doubts on Sainsbury’s solar programme

Supermarket chain Sainsbury’s solar energy programme has emerged as one of the first possible significant casualties of the EU China trade war in the UK.

The company has questioned whether it will be able to make continued investment in its growing solar portfolio because of the tariffs planned by the European Commission on Chinese solar imports.

Sainsbury’s has until now been a major investor in solar power and other renewable energies.

The supermarket chain, one of the three biggest in the country, has installed 16MW of solar panels across 169 store rooftops. Collectively they make Sainsbury host to the largest multi-rooftop array in Europe.

It has topped the global Dow Jones Sustainability Indexes review (in the food retailers sector) six years in a row, and last year the company’s chief executive Justin King said the retail sector should take another look at solar energy as a viable way to reduce its impact on the environment. “Supermarkets have the equivalent of football fields on their roofs, many of them underutilised,” he said. “It's a perfect time to turn that space into something positive.”

But the ongoing trade dispute between EU and China appears to have soured the prospects for further rolling out of solar.

In a statement, Paul Crewe, head of energy at Sainsbury’s, reacted to the threat of increased solar prices as a result of tariffs imposed by the EU: “We are disappointed by this potential measure and hope a solution can be found. Investment in the 82,000 panels on our stores has been dependent on the feed-in tariff and another tariff on top of this would make it difficult for us to justify continued investment.”

Introductory tariffs of 11.8% were introduced by the European Commission last week despite opposition from the majority of EU states.

These tariffs are expected to increase in August to an average of 47%, but already the industry, both up- and downstream, and even its customers, are beginning to feel the negative effects. Crewe continued: “This could have a significant and detrimental impact on the UK solar industry and jobs within the sector.”

Sainsbury’s are keen to point out that they will not yet retract their investment, but will wait to see what transpires in the trade dispute, and how EU trade commissioner Karel de Gucht will handle the ongoing negotiations with China.