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Solar isn’t over – just ask the Chinese

It’s easy to see why many in the sector haven’t held out much hope for the future of domestic solar installation.

In addition to the reduction of the feed-in tariff subsidies earlier this year, criticism of the Green Deal was recently compounded by a roasting from the National Audit Office.

“The end of government support may be a blip rather than a bust in the market”

Over the past year it’s become clear that public sector investment is drying up. This was expected to happen at a time when solar could stand on its own two feet.

In commercial installations this argument held water, since potential savings dwarf the returns achievable through FiT for high-energy users. Conversely, the domestic market was expected to see installations suffer as subsidies were cut.

Global assistance

However, with panels on homes set to become more viable as costs and returns become more balanced, the end of government support may be a blip rather than a long-term bust in the market.

Panel manufacturing costs have been decreasing since the 70s, but it was China’s move into panel manufacture in 2008 that marked a significant drop in cost.

While China is now the dominant market in this area, we are set to see a further step-change in panel prices as other markets in South and East Asia start to manufacture to support the growth of their own installation markets.

For the UK, the increased competition between China and these markets, and comparably lower duty when importing from other territories, will provide opportunities for costs to fall even further – making commercial and domestic installations less expensive.

“The end to subsidies felt like the death knell for domestic solar”

At the same time, the onset of battery storage will make the technology more usable in the domestic market. Panel owners will be able to store excess energy generated during the day to be used in the evening. This will improve the savings achievable and make the FiT cuts less of a concern.

Systems are already in research and development stages and we’re working with technology manufacturers to come up with a market-ready battery.

Fresh opportunities

In the meantime, the UK market is being buoyed by the wealth of opportunities coming forward in the commercial sector.

In fact, since the announcement of the FiT cut, the UK has created two large-scale floating solar arrays larger than any in Europe – one of which we installed on a United Utilities reservoir in Godley.

Battery storage and reduced panel cost should enable the domestic market to turn a corner in the not-so-distant future and also improve the already strong commercial sector.

The end to subsidies felt like the death knell for domestic solar.

However, with new technology and market dynamics, it is set to once again be a core tool used to improve the UK’s housing stock, reduce fuel poverty and emissions.

Paul McCarren is energy services director at contractor Forrest

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