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March 08, 2013

Solar Trade Association Advises DECC to Delay its Process of Non-Domestic Solar Degression



Solar Trade Association has advised the DECC to delay its process of non-domestic solar degression because suppressing the large roof-mounted solar sector makes hardly any sense. 

Earlier this week, Ofgem published automatic reductions for supporting solar PV. The Feed-in-Tariff (FIT) scheme itself lowers support of up to 3.5 percent automatically after nine months even if only little solar capacity is installed. The New Tariffs will be effective from May 2013; however, the small commercial and domestic sector up to 50KW will not be affected by this scheme.

The Solar Trade Association is typically concerned about the 250KW-5MW FIT band, where only a few installations have taken place. According to data published by Ofgem, only 9MW of schemes, designed for large industrial and commercial sites, have been developed since August 2012, and only 6MW of community-scale solar. Currently, the support of only 7.1 p/kWh is considered to be considerably low to jump start the market. At the same time, it will reduce to just 6.85p/kWh in May, thus, making the critical sub-sector of solar more out of reach.    

According to STA, the 50KW- 250KW band, which is built to be the major growth sector for the market, is witnessing constant and modest implementation and is also in a phase to take-off. The large scale and medium solar roofs with a capacity up to 1.5MW are the key features of the solar markets globally. They offer a fantastic value for money, being remarkably cheaper than several other power technologies that are supported by the Government.

Despite this fact, non-domestic roof-mounted solar is being exceptionally suppressed in the UK, because the tariff was actually set at in uneconomic rate as per the latest standards of FIT control mechanism in August 2012. Secondly, expansion of the non-domestic solar sector is significantly constrained by strict capacity allowances. With even the slightest improvement in such a scenario, the large and medium scale roof sector will kick start the market, and it will be still cheaper than several other renewable supports.

The Solar Trade Association has written to the Energy Minister, Greg Baker, advising him to leverage the capabilities of large and medium scale roof sector under the FITs, rather than constraining it. According to STA Head of External Affairs, Leonie Greene, larger and medium sized solar roofs are remarkably cost effective and play a major role in transforming the choice for communities, businesses, and public sectors in the electricity industry. If Electricity Market Reform has to be a success, with a focus to achieve fantastic value for money in the UK, the tremendous capabilities of large solar roofs has to be unlocked.

The ministers of DECC are considering to increase the maximum capacity for FIT under the news Energy Bill. The STA is more concerned that it is the failure of existing FIT bands that needs more attention today. However, DECC has sought to address this critical issue earlier via a separate FIT band in the RO for the roof-mounted systems.




Edited by Amanda Ciccatelli

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