Will the pandemic trigger a boom for rooftop solar?

The UK solar sector emerged relatively unscathed from the pandemic in 2020 and now believes that it can benefit from the new work from home culture, which has seen domestic energy costs soar. We talk to Solar Energy UK to find out more

For UK solar, 2020 was a significant year. Not just because of the unprecedented global pandemic, but because it was the first full calendar year of subsidy-free solar.

Despite both these challenges, the sector has fared well. According to research conducted by Solar Media Ltd and Solar Energy UK, an industry trade body, it saw a 27% year-on-year increase in new capacity compared with 2019, with 545MW of new solar PV capacity deployed.

60% of this came from ground-mounted PV systems, while 40% was installed on rooftops, mostly located on commercial and industrial buildings. By May, solar’s contribution to UK electricity supply had peaked at over 30%.

As the sector enters its second year subsidy free, and yet another of the pandemic, it is hoping that it can benefit from the new work from home trend that has seen a dramatic increase in interest in home improvements, most notably: rising domestic energy bills. To target this burgeoning market, Solar Energy UK is conducting relevant research to encourage more take-up of roof-top solar as a way to counteract increasing energy costs.

Impact of the pandemic

Despite some growth slowdown compared with expectations, particularly in the residential sector, UK solar has been “resilient to the pandemic”, says Solar Energy UK chief executive Chris Hewett.

“The industry had returned to pre-lockdown levels by September, largely due to the underlying market conditions, the continuing cost reduction of the technology, and the utility-scale sector reaching grid parity,” he explains.

According to the trade body, of the 545MW deployed last year, 300MW were all either merchant risk projects or had corporate or public sector power purchase agreements.

“There was no government support at all, which shows the economics for solar has reached a tipping point,” Hewett adds.

Furthermore, in the residential sector, he believes a combination of higher awareness about climate change and a ‘build back better’ mentally – the motto underlying the incumbent government’s green industrial revolution agenda – is having a positive effect.

According to data provided by MCS, a low-carbon standards organisation, there were between 3,000-4,000 PV installations each month in the second half of 2020.

“A lot more people are sitting in their houses and thinking: ‘actually, I’m consuming more energy than I did before’, this combined with an increased interest in home improvements during the pandemic, has seen more people consider solar as an option,” explains Hewett. 

An analysis by the International Energy Agency found that a day working from home could increase household energy consumption by between 7% and 23% compared with a day working at the office. The range was dependent on regional differences in the average size of homes, heating or cooling needs, and the efficiency of appliances. 

It also found that if a person was not previously commuting by car but by public transport, working from home could increase CO2 emissions because of this extra residential energy consumption.

New drivers

Another driver for the residential roof-top solar sector is the UK Government’s ambition, published in January, to make a 31% reduction in new home carbon emissions requirements from June 2022. According to Solar UK, the decision could drive a five-fold increase in new homes built with solar technologies.

To encourage uptake, the industry body is hoping to work more closely with the finance sector to encourage consumer loans or green mortgages, so consumers can take advantage of low interest rates.

To support this bid, it is also doing research into the impact on property value of solar storage and other onsite energy generation technologies.

“The idea is to evidence that the value of solar technology can be included into the asset itself,” explains Hewett.

“In the early days, a selling point of the technology was simply to pay itself back and then provide low cost energy, but I think there’s an argument that the benefit of that improvement can be passed on to the value of the property itself. It’s not clear whether the valuation industry totally understands this, so it’s something we will try and highlight.”

Furthermore, newly announced requirements for homes to be zero carbon ready by 2025 could see the vast majority of new homes in England install solar to meet those standards by 2022/23, says Hewett.

There is precedence, he says, in Scotland, where improvements to the building regulations saw most new homes installing a small amount of solar.

“We’re expecting to see 2.5KW-3KW systems becoming standard on a new home, so I think that will change the way people see solar because suddenly it will just become part of a house,” says Hewett.

Ongoing challenges for the solar sector

PV is not covered by the Green Homes Grant, which provides vouchers to homeowners or residential landlords towards the cost of installing home energy efficient improvements. Yet despite this, Hewett says that there’s still a ‘reasonable number’ of consumers interested in putting solar PV on their rooftops, increasingly linked to energy storage.

“Typically, on-site generation will match up with battery storage, an electric vehicle, which can then be matched with demand side controls for smart charging with specialised tariffs; there’s quite a lot to be done – we are starting to see that side of the market to pick up,” he says.

But he admits the upfront cost for residential PV, which can be anything from a few thousand to double figures, is a barrier.

The Green Homes Grant, nevertheless, does support thermal solar, an older technology than PV that can be used to heat water in people’s homes. The government subsidy had given thermal solar a ‘boost’. However, the grant is said to be in chaos and on the verge of being scrapped.

“There is currently an argument going on, with many industry bodies getting involved,” says Hewett. “That money can support decarbonising our housing stock; we absolutely need that grant to be there in the future as part of the longer term plans.”

Furthermore, Hewett explains that a step-change in awareness needs to happen, for the retrofit sector in particular.

“I think what we’ll need for retrofitting housing stock is a package of technologies, which can be deployed to improve the overall energy and carbon performance of homes – these could include solar PV, a heat pump, solar thermal – but very much dependent on the type of building,” he says.

He would like to see this as part of a complete retrofitting grant, to support the ‘large section of the population’ that won’t have access to the necessary capital and will, therefore, need government support.

Future for UK solar

There is 14GW of solar power capacity in the UK presently – about 8GW-9GW on ground mounds and the rest spread across the commercial and residential sectors. Solar UK has set an industry target for 40GW by 2030, but Hewett thinks the sector can actually triple capacity by then.

“The more we look into it – we’ll be producing a report later this year – the more it feels eminently achievable,” he says.

“A challenge, however, will be getting the network ready for accepting offers of distributed generation; we need to slightly change the mindset of the way the network is run so that it can accept that level of distributed generation,” he concludes.

Source : Power Technology

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