EU Controlled Minimum Import Price Must Go!
In the relatively short history of solar PV as an industry in the UK goes, when the government say they are going to do something, invariably they go ahead and do it. Following a consultation in March 2011 to reduce the financial support available to larger scale solar, tariffs were reduced to projects over 50kW. In October 2011, the government announced that FiT's for ≤ 4kW residential systems would be reduced from 43.3p per kWh to just 21p. Ever since, any proposed cut to subsidies has been carried out, consultation papers seemingly nothing but de rigueur. Each and every time there was an industry outcry; letters were written, analysis reports and spreadsheets produced and yet"¦.nothing changed the mind, or loosen the tight purse strings, of the government. Yet, each and every time, the solar industry bounced back, stronger, leaner, more stabilized and even more irrepressible.
So how can the industry hope to persuade or even justify a change of heart from DECC this time round, in August 2015? Possibly, it may have chance based purely on exactly the growth and success it has reached in such a short time. As Leonie Greene of STA told BBC news, the industry now employs over 30,000 people and is turning over billions of pounds. The taxation generated for the Treasury coffers this produces, the livelihoods of so many at stake, the international inward investment and the investments made by British entrepreneurs "“ why risk it all now? This is a big and growing industry, a massive and growing contributor to the British economy, which in 2011 it wasn't.
However, history shows us that no such argument seems to soften the mettle of a government with an overspend issue. So, can the industry survive now with few subsidies left and without the certainty that at least pre-accreditation offers, as they say they could do in a couple years without any at all? It would need a rapid drop in prices of hardware for sure. Tier 1 Chinese solar modules, currently, are artificially highly priced through the EU controlled Minimum Import Price (MIP). With this nonsensical regulation removed, this would immediately reduce the cost of solar panels by 7 or 8 eurocents per watt and make reduction or removal of subsides seem less onerous at least.
With MIP removed, the Chinese solar module industry could once again ship product into European warehouses and UK wholesalers and distribute goods quickly, cheaply and supply just in time to meet demand. With their global buying power, they could also supply "˜partner' inverters at much keener prices than currently available. Mounting systems are also seeing major changes from metal extrusion bolt on to innovative "˜plug and play' solutions, making time-on-roof much quicker and less costly in man hours to fit. Prices can fall more quickly if Europe allows free trade and forgets its current protectionist stance for a European solar manufacturing industry that no longer exists.
The UK solar industry seems to be a victim of its own success in that is has faced similar challenges to the ones faced today and has always managed them"¦.and has grown in spite of them. Would the government see any reasons why this would not happen again? There is certainly the issue of MIP that surely cannot continue when the UK Government wishes to see both the growth of rooftop solar and the removal of subsidies? There is also the issue that Chinese suppliers have found other, more profitable markets for their products, where once Europe was their biggest and only large market. How will a smaller, roof based UK market look to them when negotiating prices, when low prices are needed? Maybe some of the biggest UK buyers of modules should form a co-operative to buy modules, as a single procurer at much reduced rates? I know that buying electricity can be cheaper with a collective? But let's get rid of the MIP first can we?
