UK's bittersweet solar moment: Largest farm turns on (but don't wait for more)

When Britain's biggest-ever PV plant connected to the grid today, it signaled the beginning of a long pause. Why? Changes in government policy on feed-in tariffs.
Written by Mark Halper, Contributor

Britain switched on its largest solar electricity plant today, and while it wasn’t exactly a last hurrah, there won’t be many more for a while.

Wipe that smirk off your face. The reason for the pause is NOT because people woke up and realized that the UK is a rainy country. Solar power can work here just as it does in Germany, a country not renown for sun but which nevertheless leads the world in solar electricity production.

Large-scale solar projects are in for a British hiatus for the same reason that solar has caught on in Germany: government policy. In particular, Germany for years has supported feed-in tariffs that pay solar producers above-market rates for electricity they provide - or “feed in” - to the grid.

Earlier this year, the UK government decided to slash feed-in tariffs starting in August by between 42% and 72% for any installation over 50 kW in capacity – the largest reductions apply to plants of over 250 kW.

While homeowners still fully qualify for hefty benefits, even the smallest utility scale projects do not. It was a sudden blow to the industry in a country where feed-in tariffs only began in April, 2010.

The new solar farm in Wallingford, Oxfordshire (pictured) squeezed in under the deadline. Its 3,000 panels have a capacity of 748 kilowatts and are expected to generate 682 megawatt-hours per year, saving an estimated 350 tons of CO2 annually as the farm feeds both the grid and a businesses park that hosts the panels. It’s a small farm by standards of other countries, but a start.

Its installer, Solarcentury, plans to switch on two more similar-sized plants within the next month.

But as the Guardian newspaper notes, “these could be the UK's last big solar farms for some time.” The article quotes Solarcentury CEO Derry Newman blaming the feed-in cutbacks.

"This means that virtually all investors have withdrawn from financing such developments," Newman told the Guardian. "There were probably many hundreds lined up for development across the country. They're pretty much all cancelled now…This type of installation will be a relative rarity for a few years."

But Newman acknowledges that industry success is not all about subsidies and feed-in tariffs. Market forces will also help.He points out, as Smartplanet has noted recently, that the rapid price decline of solar panels should encourage the uptake of more solar parks.

"They will come back because tariffs and subsidies for solar are a necessary device to create the industry right now but the rate of change of price of solar is on a strong downward trend," he told the Guardian. "Within a few years, the amount of subsidy needed will go down significantly. When that happens, more of these can happen with less cost and become more attractive to investors."

At that point, after a brief sunset in large-scale solar on this drizzly island, the sun could rise again.

Photo: solarcentury.co.uk

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This post was originally published on Smartplanet.com

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