The UK solar industry has been made to wait on future government action after the long-awaited Clean Growth Strategy deferred relevant decisions for the technology until later this year.
This Department for Business, Energy and Industrial Strategy (BEIS) this morning released its 165-page Clean Growth Strategy, designed to indicate to the green economy specifically how it intends the country to meet its binding fourth and fifth carbon budgets.
But while other renewables, specifically offshore wind, received specific policy support, solar has been made to wait until decisions that the government has teased will be made later this year.
Mentions to solar PV throughout the document are almost explicitly linked to cost reductions the technology has enjoyed – achieved through the course of subsidy support – in both the UK and abroad.
The document also makes several mentions of Anesco’s Clay Hill Solar Farm, announced last month to be the first subsidy-free large-scale development in the UK, which climate change minister Claire Perry opened.
The industry was already made aware yesterday that established technologies will remain excluded from competing in future Contracts for Difference rounds, much to the chagrin of domestic solar investors, however there remained hope that the government would address continued stymied deployment of residential and commercial solar rooftops.
The end of September saw the closure of feed-in tariff term seven which marked the moment that the scheme, revised in January 2016, proceeded past the half-way point of its lifespan. The feed-in tariff scheme is scheduled to close to new applicants on 1 April 2019.
However such has deployment under the revised tariffs been that more than 200MW of unused capacity remains within the caps, capacity which was designed to be spent.
Adding current unused capacity to that which is to be allocated in forthcoming quarters, there must be more than 850MW of rooftop-accredited solar installed before 1 April 2019 if the industry is to use all of the funding allocated to it by BEIS.
Solar Power Portal has repeatedly sought to question BEIS on its plans to conduct a review of the feed-in tariff scheme, which it has previously committed to conduct before the end of this year, however the department has merely stated that the country is exceeding government projections on solar deployment.
The Clean Growth Strategy has meanwhile cast its gaze beyond the 2019 closure of the feed-in tariff. Within the document, BEIS has stated that it is “currently considering options” for its approach to small-scale renewables beyond 2019 with more details expected later this year.
Other confirmations within the Clean Growth Strategy include;
- A reiterated commitment to the phase out of unabated coal plants by 2025, with a response to the government’s consultation expected shortly;
- Confirmation that a reduced 5% VAT rate will apply to solar and storage purchases as long as they are installed together;
- A replacement mechanism for the much-derided Levy Control Framework, more on which will be revealed later this year;
- The possibility of the £200 million Rural Development Plan for England Growth Programme being used to support solar and storage installations;
- And a reformation of the Renewable Heat Incentive which, while still referencing support for solar water heaters, will prioritise long-term decarbonisation through heat pumps and biomethane technologies.
But while the industry will undoubtedly be disappointed about the lack of solar-specific direction taken within the strategy, a small window of opportunity remains open with regards Dieter Helm’s ongoing review of the cost of energy.
Helm’s review, to be published later this month or early next, will delve into the costs associated with energy generation and look to balance the cost of decarbonisation against consumer protection.
BEIS has today confirmed that the reviews findings could contribute to policy amendments within the strategy itself. “Once ministers have considered the review’s proposals, the government will incorporate its recommendations into the further development of the Clean Growth Strategy as appropriate,” it says.