Can Solar PV-T protect the UK from energy black-out?

Should solar technology underpin the future of the UK’s burgeoning energy supply? Anthony Morgan, CEO of renewable energy specialist, Newform Energy, certainly thinks so.

The latest political pronouncements and rhetoric on capping energy prices, and the consequent pressures being applied to traditional energy suppliers, provide further evidence of the turbulent situation into which the UK’s future energy supplies are falling.

The reality of restricted energy availability, and the resultant social, political and economic implications for this country, is much closer than many might realise and yet leadership demonstrates an inability, or lack of desire, to tackle this with clear policies based on the recognition and understanding of the breadth of solutions available.

The Government has committed to deriving 15% of the UK’s total energy consumption from renewables by 2020. Financial incentives – the Renewable Heat Incentive (RHI) scheme chief among them – have been designed to encourage a reduction in the supply of energy from fossil fuels, in a bid to limit greenhouse gas emissions and reduce the effects of climate change, by helping to meet UK national targets.

Domestic energy currently accounts for around 30% of consumption, of which approximately two thirds is used for interior heating and a further 17% for water heating.

Following consultation in 2012, a domestic version of the RHI was first expected in 2013 but, after multiple delays, has only now been introduced. According to DECC, the purpose of the domestic RHI is to “pave the way for mass roll out of renewable heating technologies in the domestic heating sector during the 2020s by building sustainable supply chains, improving performance, reducing costs and reducing the barriers to take-up of these technologies.”

However, within the space of just a couple of months, the Government has communicated plans for the future of domestic solar energy that are entirely contradictory.

Interviewed by a national newspaper earlier this year, Energy Minister Greg Barker suggested that householders should consider the installation of solar technology as a better investment prospect than a retirement pension.

Yet the new RHI Regulations will penalise the people who follow this very advice and install the latest and most efficient technology available.

At the forefront of technology research and development are companies such as Newform Energy, whose pioneering (and multi-award winning) hybrid PV-T (PhotoVoltaic-Thermal) technology enables householders to derive both electrical and thermal energy from just the one panel.

This cuts down the amount of roof space required on which to fit the panels as well as providing a significant saving on initial purchase and installation costs.

Up until now, customers who have already adopted this technology have benefited from the Government’s Feed-in-Tariff (FiT) payments for electricity production with the understanding that they would also benefit from the RHI payments, for thermal energy production, once the new Regulations came into force this Spring.

However, in a complete U-turn, the Government has announced that it will apply the RHI only to single function systems which generate heat exclusively. For home owners, landlords and housing associations who have already embraced the Government’s renewable energy policies by installing hybrid PV-T panels, the planned changes to the legislation will result in a loss of around £2,300 in income and will significantly extend the rate of return on their investment by around 4 years.

Intriguingly, the RHI scheme for commercial establishments, business premises and Public Sector organisations, which was introduced in 2011, remains unaffected and continues to recognise, and reward, hybrid PV-T for both its electricity and thermal energy production capabilities.

Renewable energy sources, and the technologies with which to optimise their capture, are essential if we are to ensure the lights stay on and Britain remains open for business. Hybrid PV-T technology is here now, with over 300 projects already installed by Newform Energy alone, and we should be focussing our efforts on its large scale deployment, rather than cutting it dead in its tracks. By extending its product portfolio from solar into other, complementary renewable energy technologies, Newform Energy is in a position to bounce back from this temporary set-back.

However, other British companies, who, too, have championed hybrid PV-T, may not be so fortunate. These companies have invested time, money and resources into technology that ticks several boxes at once, with a view to providing homeowners with financially viable alternatives to traditional mainstream energy sources.

Not only could their future be at risk but the Government has missed a crucial opportunity to boost industry, streamline domestic power and reward homeowners for adopting carbon reduction measures.

DECC openly accepts that a “step change in the uptake of renewable heat generating technologies” is required to achieve our decarbonisation targets and to “prepare the market for mass roll-out in the 2020s.”

It recognises that companies producing the required technology are not in a position to compete financially due to various barriers and market failures.

However, the Government appears to risk undermining the future of the entire sector – and sounding the death knell for the very companies that could help it succeed.