As the solar industry continues to settle into the post-FiT announcement market, many have spent the time since December in deep thought on how to remodel their businesses to suit the new regime. Some are going abroad while others are shifting their focus to O&M services, but it seems clear to all that the days of a heavily subsidised market have now faded away. 

Not many could look back on the feed-in tariff and say it wasn’t a heavy subsidy, particularly during the early days of 49p/kWh. With this now down to 4.39p for domestic systems, the industry that has grown around the support it once needed from government must take the last few steps towards grid parity in a new way.

Jodi Huggett of 4eco thinks self-consumption is the answer as the industry moves away from the type of subsidy that the business development director of the immerSUN system is very critical of.

“The government investment was an excellent way to start the industry and help it grow – and it grew very, very quickly – but sadly the tariff was so high that it wasn't at all sustainable. Had the government gone in at half the rate the industry would have grown a bit slower and a bit more organically but it would have been more stable and more sustainable,” she said.

“We had a pot of money thrown in which a lot of people took advantage of and quite rightly so. They were making energy from their roofs but they had no real need to consume that energy. It’s a nice idea to consume it but really it was because of the FiT that the panels were there in the first place.”

Rightly or wrongly, the idea of solar as an investment opportunity rather than a clean source of energy is one that won’t stand up as strongly, not least in the domestic market. For homeowners to keep installing in 2016, Huggett predicts that solar installations will need to change to suit the property.

“For the industry to continue we have to start consuming our own energy, making it affordable and reducing our costs,” she explained. “The only way it's going to have a long term future is if people can actually put the energy on the roof and use it, and use all of it.

“I think homeowners will look at being a little more savvy and generating energy that they can consume rather than max out to get the biggest financial incentive from the FiT. I think people will look at 2kW systems.”

With a device like the immerSUN diverting surplus power to a designated load like a hot water heater, self-consumption is already an option for homeowners. Add to that the fact that the first Tesla Powerwall systems are now being installed, battery storage is not far from making this even more attractive.

For Huggett these systems “are still a way off” due to their price and longevity but with the world bent on seeing these systems enter the market, it’s probably only a matter of time.

“I travel the globe going to different solar events and battery storage is on everybody's mind,” she said. “Everyone desires a battery storage system so that they can be off grid and they can be in control of their own power and generation but there is still the big question mark hanging over everyone's heads that it’s still quite expensive.

“Maybe when energy prices start to rise again there'll be more of a demand for it and that will create more innovation and in turn, battery systems that can last much longer and be much more affordable. But that sort of innovation only comes through market demand and I think because of the cost at the moment and the uncertainty and the low energy costs, I don't think that demand is necessarily there.”

However, what batteries and other storage technologies have on their side is the growing trend for scrutinising energy usage among both homeowners and businesses.

“I think people are much more aware of energy costs and what energy they’re using,” Huggett explained. “People are now very hungry for greater ability to control their own; they are a lot more savvy and aware now about the cost of things. I think that's because we've all gone through a period of about ten years where we're all aware of what we're spending.”

Huggett is the first to point out that she is biased towards simpler energy-saving solutions like the immerSUN, LED lighting or behavioural changes to save energy. However, most people would agree with her when she says government support for the growing battery market would probably not be a wise move.

“We want an organic industry and if we look at it, wherever the government throws in a large amount of money, they always seem to get it wrong and that causes inane problems,” she said. “We have to be careful that we have a mature approach to how we incentivise.”

The fact remains that batteries will progress and become a more attractive offering for domestic and non-domestic properties, the only question is when. Huggett believes the beginning of 2017 will see some exciting new additions to the market, leaving the rest of 2016 to develop the recovery of solar PV.

“I think we will see some very intelligent installer networks out there that will be able to tailor fit PV to the customers’ requirements with a more made-to-measure PV system. They’ll be looking at bills and consumption patterns and suggesting the kind of PV system for that to help with a household’s particular energy consumption,” she said.

“And I think we'll see a more mature market, more stable. We'll all go over the pains of Q1 and in Q2 I think we'll see some interesting ideas coming out from some of the big companies. They're all keeping their cards quite close to their chest at the moment but we know they're all trialling more options at the moment. There's a lot of head scratching going on and number crunching.”

While the solar sector certainly did not appreciate December’s announcement when it was just a few years from grid parity, 2016 is by no means game over. A number of companies are already planning their first subsidy-free developments, while Huggett believes new business models and customer habits will see the industry go forward in new ways, with self-consumption habits leading the way.