Responding to the announcement on October 31, by the Department of Energy and Climate Change of its proposal to more than half the current FIT scheme on December 12, 2011 and introduce a new tariff of 21p/kWh for installations up to four kW in size (down from the current 43.3p/kWh) and just 12.9p/kWh for schemes between 50-250 4kW in size (down from 19p/kWh), Feldmann, made the following statements:
On the UK Solar Industry as a whole: Our industry as a whole and Azur Solar in particular have demonstrated impressively, what we are collectively able to deliver. Substitution of conventional energy via solar PV and renewable energies is a reality and became a threat to conventional energy players sooner than expected. Clearly, the FIT can and must be reduced to reflect cost and productivity improvements and we all want to be able to sell a product, which in its own convinces by 2015-17 solar PV in the UK will be cheaper than conventional energy. We all working towards that and are ahead of projections.
We are not criticising the FIT reduction per se, as an industry we are in shock and disbelief about bringing the announced FIT deadline effectively forward by 3.5 months. This can only be seen as a hostile act to keep our industry purposefully small so that we do not become too big and a threat to the established conventional and nuclear players. The UK, being so far behind in the roll-out of Solar PV, means a better than expected implementation should be hailed as a success towards catching up and not reduced so abruptly. The cost to the consumer is so minimal, just a few pounds per annum, that even a supposedly overspent virtual budget is a more than worthwhile and cheap investment when it comes to delivering a clean energy future.
On the role of financiers: With all the success of solar PV in the UK, let us not forget, that without funding from private and institutional investors, we would be far lower in the roll-out. The UK still does not provide easy consumer financing for Solar PV, totally commonplace in Germany and other countries. The government has been most successful in attracting private funds to fill the gap and not using any of its own or taxpayers money which are now criticized as greedy, but by the way, have their capital locked in for a long 25 years. This should be lauded as a great success not brand marked as greed.
On Azur Solar: We have at least three to nine month lead times for training people, for placing orders, for arranging financing the technical and the financial parts need to interact seamlessly. By now giving the PV industry only six weeks notice, when we were collectively already scrambling to make the March 31st 2012 deadline, complete business models are effectively sabotaged, investments are made obsolete and business partnerships are broken up. Like any other industry, we NEED planning security and will then deliver changing the rules of the game unilaterally by government is less than helpful and threatens a lot of companies, as significant commitments and investments have been made, which now need to be written off."
How we at Azur Solar see the changes unfolding:
For commercial customers, return on investment is important, but other key issues also play a part including energy security and a customers ability to have control of their energy costs throughout the 25+ years that the installation will operate. The proposed new FIT means that mid?sized commercial projects (50-250 kWp) will now attract the same tariff band and we anticipate that more, larger installations will be considered where economies of scale provide added advantage. The concept of free solar projects will shrink, if not disappear altogether, with owner funded projects rather than third-party financed schemes, that provide realistic but still acceptable return on investment, becoming the standard.
Azur Solar has a wealth of experience gained from operating in other, sometimes just as volatile, overseas solar PV markets and has experienced and adapted to market changes. Our still expanding network of installation partners and distributors will benefit from our experience, support and professional approach. Together well deliver a sustainable business but it is crucial that they work with us to avoid supply disruptions, maintain their sales pipelines and continue to meet installation deadlines and requirements.
In the Domestic sector, equipment prices will continue to come down throughout 2012, so homeowners should still achieve something approaching six to 10 percent return on investment over the forecast operational life of a quality PV solution.
Selecting technically advanced and unique products will also make a real difference, which is where Azur Solar has a real advantage and where we are concentrating our development efforts. Were seeing a real shift in the demand for products like our unique Azur 2P coated modules. These are virtually free of degradation, produce up to 15 percent more lifetime power plus are guaranteed to still perform at above 98 percent efficiency even after 25 years. This makes a real long term contribution to overall amount of energy produced, therefore the return on investment and gives us a key advantage over many competitive offerings.
The winners in both the commercial and domestic sectors from this change will be those still wanting energy autonomy, localised production and consumption, security and an ecologically sound solution, delivered by companies like Azur Solar that focus on quality, trust and delivering a realistic and sustainable rate of return. The losers will be high risk equity speculators and unprofessional providers. We are therefore forecasting a long and successful future for Azur Solar and the broader PV solar sector in the UK reflecting the German market where volumes went up significantly when sustainable financial packages were introduced and truly believe that even with the new FIT we have a sustainable solar sector.
