Researchers at the University of Surrey in the United Kingdom have estimated the LCOE for Great Britain. They said that PV systems could become cheaper by up to 50% by 2035.
Based on its analysis of data on electricity pricing in the United Kingdom from 2010-21, the group said that large-scale PV systems were already less expensive than wholesale electricity in 2021. Prices stood at GBP 51/MWh, while the cost for smaller systems was estimated at GBP 149/MWh.
The researchers projected the LCOE for various PV system sizes until 2035, considering different variables. The study's results suggest that in the most optimistic scenario, the LCOE for large-scale photovoltaic systems in the United Kingdom could reach as low as GBP 17/MWh.
The group's projections for small solar system sizes (below 3.99 kW) suggest that the cost of generating electricity from small-scale photovoltaics will drop lower than the price of wholesale electricity around 2027. The researchers said that at this level, “it can be expected that many households and businesses would want to install even small-scale solar PV panels to reduce their electricity costs and promote environmental consciousness.”
The United Kingdom had a capacity of 13.5 GW in 2020, ranking 10th globally and third in Europe. The researchers forecast that the capacity will increase to around 21 GW in 2025 and approximately 29 GW in 2030. Considering the projected efficiency improvements and cost reductions, the study suggests that the UK government should support developers and investors, particularly in the early stages, by facilitating land purchases for PV farms and offering preferential loans with low interest rates to expedite PV system development.
More support would speed up adoption of the technology, leading the country to transition more quickly to a carbon-free future, said the researchers. They presented their findings in “Levelized cost estimates of solar photovoltaic electricity in the United Kingdom until 2035,” which was recently published in Patterns.
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