With potential boundary lines drawn around planning application submissions on 22 July 2015 and buildout under ROs by 31 March 2016, what DECC is effectively proposing is a cap on large-scale solar farm deployment under ROCs, with the final capacity installed based upon what the industry can manage to do now over the next seven and a half months.
Knowing what projects come under this unofficial cap is the only game in town now for anyone concerned about utility-scale solar in the UK, and we have been blogging extensively on this at Solar Media in the past couple of months, half expecting the DECC proposals at any time.
However, one glimmer of hope for the industry resides in the appeals process. It is somewhat ironic to write about this in a favourable light on a day when DECC (largely on the orders of the Treasury, of course) is seeking to create legislation to remove LPA (and appeals) jurisdictions for shale gas deployment in the UK. One wonders why the government does not simply abolish planning altogether for fracking, and bring it effectively under state control, as it does seem as though this is where things are heading.
Back to solar, however, and the appeals issue. Appealing planning decisions remains a cornerstone of the UK’s planning system and this is open to both parties (developer or LPA) and indeed the Secretary of State. Mostly of course, it is the developers that choose to lodge appeals, having been the ones with the upfront costs.
Currently there is approximately 600MW of solar farm capacity awaiting appeal outcome, with this spread mostly across a sub-set of 35 different LPAs. See figure 1 below:
Figure 1: There is approximately 600MW of solar farm proposals pending appeal outcome, with about 35 different LPAs involved. Source: Solar Media UK Ground-Mount Report 3 – Opportunity Pipeline, August 2015.
More interesting however is the breakdown of this 600MW by developer, shown in Figure 2. Of course, the ideal scenario for developers is to never have to even consider the appeals process but to do this you either have to be 100% successful in applications, or decide simply that rejected proposals are left alone and you move onto getting success in the next ones.
So, in some ways, the developers that make up the large parts of the 600MW are either ones that have put in so many applications that purely by statistics there will be a bunch that are rejected and could be put into the appeals queue (e.g. in Figure 2, Vogt, Green Hedge, BSR, Elgin, TGC, etc.), or those that have a low success rate, and see the appeals process as offering a better chance of acceptance than the LPAs applied to in the first place.
Figure 2: Almost forty different developers have solar farms at appeal today, adding up to about 600MW of potential capacity. Source: Solar Media UK Ground-Mount Report 3 – Opportunity Pipeline, August 2015.
Top of the list for appeal capacity today is a company that some readers may not have heard of before – Green Switch Solutions. From over 260MW of full solar planning applications, 67MW has been approved and over 100MW rejected (or withdrawn before decision made). Of the 100MW-plus rejected, almost 70% was then put straight into the appeals process. So, in effect, almost 30% of the original MW applied for ended up at appeal – percentages way higher than any other developer in the UK sector. This contrasts with the most successful developers that have over 90% of MW capacity approved, sold and ultimately built and accredited.
The final part of the analysis relates to the incentive mechanism behind the sites. This is shown in Figure 3. This highlights probably the most interesting part of the solar capacity currently at appeal: almost 50% of the MW capacity would qualify for 2014 grace compliancy, highlighting the true potential of this part as the final opportunities for >5MW large-scale solar accreditation under ROs (regardless of what happens to the <5MW specific proposals from DECC on 22 July 2015).
If you are reading this, and are in the business of acquiring assets from large-scale solar farms, you really ought to be tracking every project that makes up the 296MW of potential (appeal-pending) 2014 grace-compliant RO criteria. How many other Eveley’s are out there for example – who, if anyone has first crack at them if built?
Figure 3: Half of the solar capacity currently at appeal would qualify for 2014 grace-compliancy, if upheld, financed, grid-connected and accredited before 31 March 2016. Source: Solar Media UK Ground-Mount Report 3 – Opportunity Pipeline, August 2015.
Over the next couple of months, we expect the MW sum allocated to the 1.3ROC (2015 Grace) part to go up, not down. This is due to the rate of appeal submissions for rejected 5MW sites likely to be greater than the rate of appeal decisions being made.
Ironic then, that on a day when DECC has sought to ‘fast-track’ approval status for shale gas in the UK by effectively tweaking the planning/appeals system, it is the appeals portal that may offer the final hope for large-scale solar in the UK before anything CfD comes around.
Details of all the projects at appeal, and all prospects for large-scale solar under FiTs, ROCs and CfDs, are contained within the Solar Media Solar Media UK Ground-Mount Report 3 – Opportunity Pipeline, August 2015, updated daily by our research team, and released every two weeks. Contact us to learn more about this.