After several months of waiting, last week can officially be identified as the real start of build-out under 1.3 ROC accreditation.

Deployment in the UK has been modest during Q2 and Q3 2015 with installations (covering all rooftop and ground-mount) segments being 253MW and 317MW, respectively. This came after Q1 2015 at 2.53GW.

Interestingly, DECC has finally caught up with Q1 numbers and their release last week is now showing 2.5GW, providing a valid reference point for the methodology our in-house team at Solar Media is using to track the UK solar market. We are also in the process of setting up additional data feed elements to allow us to size 2016 activity with an even greater accuracy.

German EPCs could dominate Q1'15 ground mounts

While the UK has seen strong EPC activity from Spanish and Portuguese EPCs in the past, perhaps the next few months will see more activity from a group of five or six German EPCs that are now in pole position.

This includes some of the largest 2014 grace-compliant deals that have come out of planning in the past couple of months. Already site rights have been transferred over from some pure-play developers, adding confidence to the contributions from 2014 grace-compliancy that will bolster Q1 2016 ground-mount capacity added.

Chinese inverter suppliers winning deals

Several years ago, limited activity was seen on the large ground-mount solar farms in the UK from Chinese inverter suppliers. This started to change about 12 months ago, and it would be no surprise at all by the end of March 2016 if Chinese inverter suppliers Huawei and Sungrow started to challenge the UK’s number 1 inverter supplier, SMA.

We are also expecting Schneider and ABB to increase market-share compared to Q1 2015, with Power Electronics being potentially limited by business levels on offer from established EPC supply channels.

Solar Frontier emerges as wildcard for top module supplier ranking

The biggest surprise however as we conduct our daily downstream channel checks across the pipeline projects is the inclusion of Solar Frontier as the selected module supplier for many of the solar farms over the next three to four months. Previously, Solar Frontier had only been used on a handful of small solar farms in the UK.

In many respects, the stars are truly in alignment for Solar Frontier shipping to the UK right now. Here are the different factors now helping Solar Frontier for UK market share and in many respects capture dynamics at play with global supply and demand for the solar industry as a whole.

Unlike the majority of the top 10 module suppliers globally, Solar Frontier is not sold out to the middle of 2016. This is due to several factors. First, Solar Frontier is limited to in-house supply of modules for shipments, by virtue of having a differentiated technology (CIGS thin-film), and as such capacity and production levels should ideally follow shipment forecasts internally.

More critically however, Solar Frontier had largely retreated from overseas sales efforts to concentrate on the Japanese market when it blossomed a few years ago, overlapping also with the full ramp-up of its 900MW Fab 3. Indeed, confidence in domestic shipments (which had started to account for over 90% of production) even led Solar Frontier to restart its mothballed Fab 2, and press the button on building a fourth fab (150MW).

However, by the time Fab 4 was online, Solar Frontier’s prospects from the Japanese market had faltered, with end-market demand in Japan plateauing, declining market-share for the Japanese brands in their domestic market at the hands of growing Chinese module imports, and reduced margins due to strong price erosion.

Fast forward to the middle of 2015, and Solar Frontier now has bandwidth and product that has to find an overseas market quickly. Enter the UK and most of the leading module suppliers to the UK hitting the sold out wall today.

It gets even better for Solar Frontier though, thanks to First Solar and Belectric. Belectric has been one of the leading EPCs in the UK in the past few years, with some of the largest single-sites completed so far in the UK. For its ground-mount sites, Belectric opts for thin-film, with First Solar having been the preferred supplier until now for these sites. Solar Frontier appears to have been used more as the back-up by Belectric, presumably when supply was not available from First Solar.

And during 2015, supply from First Solar for any third-party sales (total shipments, less in-house projects developed by First Solar, often heavily weighted to the US end-market) has been in stark supply. In fact, similar to a handful of other module suppliers globally, supply to Europe has effectively been rationed, especially after the German market collapsed.

Consequently, it is not inconceivable that every Belectric ground-mounted site between now and 31 March 2016 ends up using Solar Frontier modules, making up a chunk of business for Solar Frontier that could alone give it record UK supply numbers.

Another source of module supply for Solar Frontier could rest with the success of a raft of 4.99MW sites currently going through planning applications courtesy of a mainland European developer/EPC, many of which are located in the north of England. Still some risk is contained with this strategy however, as discussed later in this article.

Indeed, it almost looks like an early Christmas for Solar Frontier’s German based HQ, with even residential and commercial rooftops starting to use Solar Frontier panels more than in the past. Here, a couple of things really help. First, keeping stock locally is always going to be a winner for the small rooftop installers. But more importantly, Solar Frontier is as non-MIP as you can get (not Chinese, not c-Si).

As such, pricing of Solar Frontier modules can be extremely competitive, something that is music to the ears of small-scale installers right now in the UK.

Grim up north for some new developers to the UK market

When we look at all the projects going through planning decision-time, we are starting to see some trends emerging in the past few weeks that are not completely surprising to us.

When news got out 12 months ago about how big the UK market had become, and due also to the continued weakness of solar across mainland Europe, lots of new developers entered the UK solar market. This included a bunch of specially formed UK-based newcos that were comprised of city money and rural land developers, fixed largely on short-term shovel-ready flipping for a quick buck. Furthermore, a bunch of European (largely German based) developers also turned to the UK solar market as if the Levy Control Framework budget was a bottomless pit.

Many of these new developer consortia went north in the UK, presumably attracted by cheap land, untouched green fields, and managing to convince the town councils there to go green. So far, few have had much luck, and the success of the 22 July 2015 application deluge is yet to be seen.

In the past two weeks, two local councils for example summarily rejected every solar farm application scheduled for decision making. Of course, these are extremes, but it highlights the risk of descending forcefully upon a rural LPA that frankly speaking has never even seen or heard of solar power before, and expecting them to act favourably on a dozen or so planning applications for 5MW sites hitting their desks at 11.59pm on 22 July 2015. For many – indeed most – of these sites, little if any public engagement had been done before 22 July, which is a risky strategy at the best of times.

2016 in the UK

Some rather low forecasts have come out in the past few weeks for UK deployment in 2016, in particular from REC Solar and SolarWorld. Indeed, some observers are even saying the UK will add only 1GW for the whole of 2016, and others issuing numbers south of this level.

Many are simply following the naïve assumption of what happened in other mainland European markets in the past, or perhaps just want to sandbag on sales forecasts ahead of 2016 targets being given to regional sales teams.

What it does show however is the chronic state of uncertainty that has fallen upon the UK solar market in the past few months. It is hard enough forecasting 2016, even having all the bottom-up site prospects and being connected with the industry locally. For overseas observers, it is therefore not a surprise that the forecasts for 2016 would seem to be somewhat plucked out of thin air, and as low-ball placeholders.

To address much of this, we have organised a special webinar, titled ‘Uncovering the UK solar industry in 2016 – why the UK will still be the largest solar market in Europe next year’ to take place 11am on Wednesday 9 December. In this webinar, we will be discussing the prospects for the UK solar industry in 2016, by quarter, by segment (roofs, ground, etc.) and by funding mechanism. You can sign up for the event by registering here.