Inside story: Industry’s reaction to roundtable with DECC

In the wake of industry-changing announcements from DECC today, solar industry insiders were invited to a roundtable discussion with Greg Barker at the Department’s offices. The meeting was called to gauge industry’s reaction and explain DECC’s ambitions for solar in the UK.

Speaking to an industry insider, Solar Power Portal learned that, following the announced changes to the FiT scheme, the mood inside the meeting was fairly positive with the vast majority of members welcoming the proposals put forward by DECC, with certain caveats.

Of major concern for solar industry stakeholders is the dramatic cut to the generation tariff proposed in ‘Option A’ of the consultation document, that could see the domestic FiT rate drop as low as 13.6p/kWh by July of this year. Members of the department were keen to stress that the figures proposed in the document are open to consultation and are therefore subject to change. Furthermore, ‘Option A’ reflects a worst-case scenario. It is believed that after the considerable embarrassment caused by the current FiT legal wranglings, ministers could not be seen to have underestimated the market again. Therefore, Option A is acting as a safety net, lest the unforeseen should occur.

Members of the solar industry also raised concerns that, in anticipation of a drop from 21p, the industry could experience another ‘gold rush’. If that were to happen, it could distort the installation figures for March and April, which DECC will use as a benchmark against which to set the July 1 feed-in tariff figures. As the July figures will form the basis for future degressions, it is important that Government set it at the right level.

Greg Barker appears to be convinced that solar can now play a key role in helping Britain meet its climate targets, a marked difference to previous meetings, where solar was derided as a small-scale solution. The Climate Change Minister reiterated his commitment to see 22GW of solar capacity installed in the UK by 2020. Under ‘Option B’, cumulative installs by 2015 will amount to 4.3GW. Barker expects a further 3.5GW of solar to be installed before the end of the Coalition term.

A roundtable attendee told Solar Power Portal that, despite the criticisms levelled at DECC, the signs for the industry going forward are positive. Government could have easily killed the industry if it wanted to and the Minister’s publicly-stated ambition of 22GW did not need to be shared if Government did not genuinely want the solar industry to succeed.

As always, the devil will be in the detail of DECC’s proposed changes to the feed-in tariff. For now, it appears that solar is finally being considered as a major contributor to the UK’s renewable energy mix.