Select Committee on Trade and Industry Appendices to the Minutes of Evidence


APPENDIX 39

Memorandum by Solar Century

  We are concerned that the Government's Energy Review appears to be in danger of both underestimating the extent of the fossil fuel and nuclear energy gap facing the UK and of failing to deliver the urgent and necessary policy measures required to boost our fledgling domestic solar PV industry.

  In particular, the argument advanced by Energy Minister Brian Wilson at your hearings on Tuesday that renewables including solar PV are a practical option for "the very long term" seriously underestimates the short-term potential of this innovative technology, which is already being promoted successfully by some of our leading industrial competitors. Put simply, the UK will remain far behind Germany and Japan in the race to develop a new solar energy industry if the Government continues along its current cautious path.

  For example, the PIU's recent recommendation in "Renewable Energy in the UK" of just £10 million for solar PV for the next three years plus an unspecified share of a further £10 million community fund falls far short of the Government's own commitment to embark on a major solar PV programme "in line with those in Germany and Japan".

  In the past, Ministers have made it clear that being "in line" entails building a domestic solar energy manufacturing capability. But large manufacturers of PV such as BP Solar have already indicated that a 30 MW or 15,000 roofs per year market will be needed before they will consider manufacturing in the UK. Thirty MW in the UK is clearly achievable. This was the figure achieved in the fourth year of the Japanese programme, and the second year of the German one. Last week's approval of a $100 million bond issue in San Francisco provides another useful benchmark for UK policy-makers. As a result of the bond issue, San Francisco alone could produce up to 20 MW of solar PV electricity within 12 months, with the prospect of an additional 50 MW over the next three years.

  But Solar Century's current best estimate, based on the funds the Government has announced to date, shows well under 10 MW in the UK by year three (2004-05) ie approximately 5,000 roofs and just half of the total projected for San Francisco by end 2002. We will be leaving it too late to join the front rank of the solar revolution if we continue to go at the current slow pace.

  In Germany and Japan, the high-tech, innovative, safe and sustainable PV option has been boosted by mixes of policy measures including capital grants, tax incentives, net metering that enables solar customers to sell their excess electricity back to the grid, low-interest loans and premium prices for green electricity. A similar strategic imaginative approach is required in the UK, before we can expect innovative entrepreneurs to invest in the UK solar PV market or promote solar PV successfully as a mainstream energy option.

  Such a strategic Government approach could include for example changes to planning policy to encourage developers to include a percentage of solar PV in all new developments. This move would send the clearest possible signal to manufacturers, developers, local authorities and domestic customers alike, and could form a key part of any long-term "joined-up" energy strategy in the UK.

  We would like to invite you and members of the committee for a full briefing on these issues and a demonstration of the applications of modern solar PV technology here at our solar-powered offices and show-room at Waterloo. In the meantime, if you would like any further information or have any specific questions please let me know.

23 November 2001


 
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