Utility Week - authoritative, impartial and essential reading for senior people within utilities, regulators and government
Issue link: https://fhpublishing.uberflip.com/i/883062
UTILITY WEEK | 6TH - 12TH OCTOBER 2017 | 25 Operations & Assets development of 5-25MW projects since the grace period for the RO expired at the end of March. Leonie Greene, head of external affairs at the Solar Trade Association (STA), says Clay- hill is a "trailblazer" project. "The scheme itself is fantastic. It's exactly where we want to be, solar with storage, clean power when you need it, it's great." The STA expected to see schemes like Anesco's emerge, Greene says. "There's a lot of pent-up pipeline, lots of people who sunk costs getting a project together, getting grid connection and planning. So there are a lot of projects looking for any opportunity." But she says that the milestone should not be seen as the start of a rash of subsidy- free solar farms. Indeed, Greene does not know of any developers who are working on a similar model. She explains that there was potential for a lot of sites like Anesco's, but most devel- opers are being held back from co-locating projects by uncertainty over whether existing schemes will still be eligible for payments under the RO once they have battery storage on site. "If the RO is your main source of income, it's just too great a risk. We're working with Ofgem on this, but it's incredibly slow," she says. Anesco seems to have found a solution to this, but the rest of the industry is in the dark as to Ofgem's criteria for allowing RO payments to continue. She says: "We're look- ing to Ofgem to clarify a coherent, harmo- nised approach on what qualifies." The STA wants the government to readmit solar PV projects into the contracts for differ- ence (CfD) auctions to provide a level playing field with other energy technologies. Solar could achieve a price of £50-54/MWh or pos- sibly lower, which is so close to the whole- sale price that projects would effectively be almost subsidy free, Greene believes. "But without the CfD, your costs of finance are higher, the risks are higher. Pro- jects just need that to reduce that final cost element. It's very close, but it's not quite there yet," she says. Catherine Early is a freelance journalist Energy minister Claire Perry on solar energy and the clean growth strategy Claire Perry was clearly excited by what Anesco had achieved at Clayhill, which demonstrates "a level of ingenuity and creativity" that she wants to celebrate, she said. Though subsidies have been a great way to get markets moving, renewable energy does not need to rely endlessly on them, she added, particularly praising the innovation of Anesco's supply chain for achieving cost reductions. "This is an example of where it comes together and it's just brilliant." "I think we can replicate sites like this. The economics work, I know Anesco has other sites in play. It's a really, really good model and it would be great to see this replicated right across the UK." She conceded that she did not know of other developers who were working on subsidy-free solar plants but said "that doesn't mean that there aren't any. What I want to understand is what are the barriers are them. I think this is a really sensible idea, storage and production, the innovation in the supply chain, I want to make sure that happens. "What I heard today is that there is very clearly an appetite among investors to work with this sort of site again, but I need to understand what companies need from regulators, from the grid and from govern- ment to make sure that certainty is there," she said. She believes that it was right to change the subsidy scheme supporting solar farms because lots of sites were being built entirely based on government support and the industry was not innovating. "There is always a question about the right time to withdraw sub- sidies, but the fact is that you have examples like this coming forward, Britain's first subsidy-free solar farm, which is using the world's best technology," she said. The long-awaited Clean Growth Strategy will be published "very, very soon", Perry told the assembled media. Publication of the suite of policies needed to meet the government's climate change targets has been repeatedly delayed. But Perry said that the strategy had been complex to develop. "We've done really well decarbonising energy but now we need to do the heavy liing and do more right across the economy – transport, business energy efficiency – doing that is not as simple as one minis- ter standing up; it's a very concerted cross-government effort with lots of policy initiatives," she said. She denied that the delay of the paper would hamper the UK's ability to meet its climate change target: "I think it's given us time to be more ambitious and look more closely at things like the subsidy regime." UTILITY-SCALE INSTALLATIONS, JAN 205 - MAR 2017 Source: STA 90 70 60 50 40 30 20 10 0 MW Jan 15 Apr 15 Jul 15 Oct 15 Jan 16 Apr 16 Jul 16 Oct 16 Jan 17 Apr 17 Anesco executive chairman Steve Shine with climate change minister Claire Perry