REC Urges DECC To Consider German Example While Considering Subsidy Changes
REC, the largest European supplier of solar panels, welcomes the continuous monitoring of the U.K. solar market by the country's Department of Energy & Climate Change (DECC) and appreciates the consultation procedure for the planned changes of the Renewable Obligation (RO) and the Feed-in-Tariffs (FiT) systems. By this, adaptations for a reliable and affordable renewable energy mix can be better considered and implemented. The government considers closing the RO system two years earlier (on April 1, 2015) for new solar parks that have a capacity of more than 5 MW. Furthermore, it is proposed to split the current FiT degression band for over 50 kW and stand-alone installations into two separate bands to increase deployment of commercial and industrial rooftop solar installations.
REC, with its extensive experience in various markets, anticipates that such crucial changes will lead to uncertainties for all market participants and impact the whole U.K. solar market, which has to now been one of the more stable ones. This market uncertainty is currently visible in the German solar market. Due to planned changes of the EEG on a short term notice, the solar market has shown a significant drop despite the fact that many solar installations remain attractive even under the new conditions.
REC recommends that such changes shall be introduced with caution and sufficient lead time. Solar parks with system sizes over 5 MW are long-term projects and require on average more than 12 months of lead time. In addition, the extremely high requirements for solar projects already in progress to qualify for the proposed grace period - which ends on the same day as the announcement of the planned changes, May 13, 2014 - are unrealistic and counterproductive for the whole market.
According to IHS, utility-scale solar projects are expected to make around 60% of the entire PV market in the U.K. in 2014. Therefore, changes impacting this segment will be crucial for the solar industry in all of the U.K.
However, REC welcomes the government's efforts on opening up the market for mid-scale commercial and industrial onsite electricity generation. The global solar energy solutions provider sees huge potential in this segment and as a global trend, in particular self consumption installations, providing companies the opportunity to be more independent from increasing electricity prices, to reduce their energy costs and make an active contribution to protecting the climate.
