Home solar will eventually triumph in the UK

Back in 2013, then-UK Prime Minister David Cameron pledged to “get rid of the green crap” he alleged was proving too expensive for bill payers. His government subsequently ended the Green Deal scheme in 2015, removing grants to install solar panels. Coupled with a weakening of the UK’s feed-in tariff offering to consumers, the rate of solar installations across the country slowed while other European countries made remarkable progress.

Although this hindered the rate of solar adoption in the United Kingdom at the time, positive steps have been taken in recent years and the outlook for residential solar power in the country is highly positive.

For example, the Smart Export Guarantee (SEG) scheme, introduced in 2020, ensures homeowners are more fairly compensated for surplus electricity they feed back into the grid and sends a clear signal about the country's direction of travel.

In 2022, the UK government eliminated value-added tax (VAT) on solar panels and batteries, among other energy-saving materials. That has led to increased solar uptake across the United Kingdom as installation costs have fallen and solar array payback times have shortened. Industry standards authority the Microgeneration Certification Scheme reported more than 180,000 domestic solar installations in 2023 – a rate of more than 15,000 per month that made 2023 a record-breaking year for solar in the country.

The United Kingdom still remains a European outlier for solar adoption and is far behind where it could be; just 6% of UK households have solar, versus 25% in the Netherlands, 22% in Belgium, and 9% in Switzerland and Austria. To put this into context, over the past year, only 4.7% of the UK’s electricity was generated from solar, compared with 31.9% from gas and 31.5% from wind, according to figures from utility National Grid.

While there is clearly still more to be done, the compelling benefits of solar make it a matter of when, not if, the United Kingdom will turbocharge its rate of solar installation.

In the face of an increasingly volatile energy market and overpriced energy bills, residential solar offers environmental benefits, energy security, and significant financial savings. Government-sponsored initiative the Energy Saving Trust has estimated a typical household with a 3.5 kWp solar system can knock between GBP 135 ($169) and GBP 360 per year off bills at current Energy Price Cap rates.

Moreover, the remaining bureaucratic hurdles can arguably be remedied with relative speed and simplicity. At Otovo, this is why we are focusing on expanding across the United Kingdom. Solar will win out everywhere and the United Kingdom is no exception.

Simplifying solar

Several of the most impactful measures that can be implemented to support solar across the United Kingdom are clear for all to see. Take grid connections, which can lead to months-long delays for consumers. Standardizing the application process across all electricity distribution network operators, making more resources available, and streamlining the permitting process would have a hugely beneficial impact.

Once systems are connected, and as the increase in solar uptake leads to more green energy being produced across the United Kingdom, selling surplus energy back to the grid will become a powerful tool in the country’s arsenal and an attractive opportunity for new solar adopters.

Although the United Kingdom has the SEG, requiring electricity suppliers to pay individuals for low-carbon electricity they export back to the National Grid, the incentive for consumers to do so is limited due to the relatively poor deal offered for this energy, compared to current electricity prices. Of the current energy suppliers, only Octopus Energy offers an attractive and worthwhile deal for consumers to do this. Here, steps can be taken to ensure the deal offered to consumers is stronger across all suppliers.

The cost of solar can be off putting for many people. That is why Otovo launched solar subscriptions in the United Kingdom in March 2024, with no down-payment and a commitment to take care of the installation and upkeep of the panels, which come with a 20-year warranty. Customers will own the panels outright after 20 years — and the battery after 10 years. They can also buy them out at any time during the payment plan.

Across our other European markets, customers are attracted to the ability to reap the benefits of solar from day one without having to save considerable sums to install a system. Simply put, the flexibility offered by financing through leasing will be a game-changer for the United Kingdom’s current growth in residential solar adoption – as it is already proving across our other European markets.

We are confident that solar adoption in the United Kingdom will surge with the right support. Moreover, the abovementioned measures are neither inherently politically challenging nor costly to the taxpayer. Far from being a political football, residential solar, if anything, is an open goal.

Of course, the choices made by whoever forms the next government will affect the rate of solar installation across the United Kingdom in the short term. In the long term, however, the positive trajectory of solar energy is indisputable, as more households reap the financial benefits and energy security, not to mention the obvious environmental merits. We look forward to playing our part at Otovo in actualizing solar en masse across the United Kingdom.

About the author: Jina Kwon is the United Kingdom and Ireland general manager at European solar marketplace Otovo.