Clean Growth Strategy: has solar become a dirty word for UK government?


Does the U.K.’s Conservative government have an ideological problem with solar power? A quick Ctrl+F of today’s (lengthy) press release announcing its new £2.5 billion Clean Growth Strategy yields zero returns for ‘solar’ and ‘PV’, despite the very title of the release featuring the words “cost-effective clean growth”.

Solar is not only the British public’s most preferred energy source, it is also fast becoming one of the cheapest options, and has long been the most scalable. The absence of any direct fiscal support for solar was anticipated; however, the lack of any mention of the technology has prompted the chair of the Solar Trade Association (STA) Jonathan Selwyn to urge the government to “shake off its blinkers”.

The Clean Growth Strategy even includes a series of policy recommendations and support for technologies and industries that could not thrive without solar power, which indicates that the government is well aware of PV’s positive impact on, and potential for, the U.K.’s clean energy future, but appears ideologically opposed to calling it by name.

“The central role of solar in any modern economy means that solar power is implicit in many of the policies outlined, such as smart systems, public sector emissions reduction, EV charging, retrofitting existing properties, Green Mortgages, and industrial sector efficiency,” said the STA. “However, there is little detail on when and how these new proposals will be implemented.”

The U.K.’s solar industry has already survived the wobble of having the rug pulled prematurely from under its feet in 2015 with its early exclusion from the Renewable Obligation Certification (ROC) scheme, and the industry has waited for clarity on the FIT review and CfD auctions for more than two years. In the meantime, the STA says, major job losses have been felt in an industry that was previously among the fastest-growing in the country.

“It does seem extraordinary that when a technology as vital to the world's future as solar is asking, not for any new public support, but for simply a level playing field with other technologies that the Government is not moving to respond,” mused STA policy manager Christ Hewett. “This technology will dominate global power supply in years to come so in the interests of UK plc, the Government needs to stop putting the UK solar industry at a competitive disadvantage.”

These disadvantages, the STA argues, are manifest in the tax breaks still on the table for fossil fuels, the continued emphasis on centralized power over local power, and a lack of solar access to power auctions.

The CfD auctions were launched in 2015 with solar invited to bid for tenders. However, subsequent auctions have blocked the technology from competing, while at the same time the FIT has been drastically slashed. Residential rooftop PV deployment rates are now 20% the level they were in 2015, while in the current financial year the U.K. has installed just one ground-mounted solar farm.

The STA argues that a new solar+storage category should be invited to be eligible for Pot 2 auctions in the next CfD, with VAT for storage installed alongside existing solar brought down to 5%. Additionally, the association is campaigning for a supportive tax and regulatory framework for C&I solar investment, with business rates equivalent to those on offer to CHP projects.

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Clean power = economic growth
The government’s solar blind spot not withstanding, the raft of other initiatives announced in the Clean Growth Strategy were met with mild acclaim from green energy advocates across the U.K. The Renewable Energy Association (REA) praised the “language and ambition” of the plan, and welcomed the fact that government no longer feels that decarbonization and economic growth are mutually exclusive.

The lack of specific, concrete details was criticized, however, and prompted the REA’s head of policy and external affairs James Court to state: “We will have to ensure we are pushing government for how they intend to address the big issues of adding low-carbon generation, greening our heat system, cleaning our transport and leading the decentralization revolution.”

In welcoming the Strategy, Green Alliance executive director Shaun Spiers said that “the test now is to embed the strategy across government and encourage investment in clean growth by giving businesses the certainty they need”.

One such step will include a £505 million investment in the Department for Business, Energy and Industrial Strategy’s (BEIS) Energy Innovation Programme, which aims to accelerate the commercialization of innovative clean energy technologies and processes. While vague, the sums involved would hint at some significant financing for solar PV and storage projects, given these technologies’ prominence in the U.K.’s clean energy landscape.

“For the first time in a generation, the British government is leading the way on taking decisions on new nuclear, rolling out smart meters and investing in low carbon innovation,” said BEIS secretary Greg Clark. “The world is moving from being powered by polluting fossil fuels to clean energy. It’s as big a change as the move from the age of steam to the age of oil and Britain is showing the way.

According to the PwC’s Low Carbon Economy Index (LCEI), the U.K. is decarbonizing faster than any other G20 nation, hitting a decarbonization rate of 7.7% in 2016.

British Prime Minister Theresa May said in the Strategy's foreword: “Clean growth is not an option, but a duty we owe to the next generation. Success in this mission will improve our quality of life and increase our economic prosperity.”

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