Renewables

“Scotland” and “Sunshine” are by no means synonymous. Relying on the sun to produce green energy might seem optimistic in Scotland, particularly having reached that time of year again of rolling the clocks back in anticipation of a long dark winter ahead. Climate restraints aside, solar deployment has also been hampered by recent cuts to Feed-in tariff subsidies, business and VAT rate hikes, and obstruction to clean power auctions.

Since the reduction of Feed-in Tariffs in the early part of 2016, the solar industry has been forced to come to grips with the prospect of developing free of any subsidies. Whilst critics have argued that this was introduced too early, most understand that this is the end point that the sector needs to reach, and has been an essential component to increasing efficiency and driving down deployment costs. This has led to the UK’s first unsubsidised industrial photovoltaic (PV) farm being completed this year and was followed by the recent announcement by Scottish Power (SP), one of Britain’s “big six” energy companies, that it will invest in solar power for the first time as part of its move away from fossil fuels. This shift will complement SP’s existing wind portfolio, allowing a more consistent production of electricity when wind levels drop during warmer weather in the summer and  vice-versa during colder windy months. Falling costs have seen solar capacity rise in the UK to around 13.05 Giga watts from around 2 Giga Watts 5 years ago, and one day in May this year solar hit a record high, providing almost 25% of the country’s electricity.

Aside from the UK’s “big six” energy providers, solar is now becoming increasingly affordable for the consumer too. The costs of solar panels have decreased quite dramatically over the last few years. For example, in 2011, the average cost of a 4KWp system – a typical domestic roof top scheme – was around £12,000. By the middle of June this year, that cost was down to around £6,000 on average, and following the European Commission’s announcement in September scrapping the minimum import price imposed on solar PV cells and modules imported from China, it’s widely anticipated that deployment costs will continue to fall.

A further consequence of reduction to Feed-in Tariff subsidies is that consumers are now being forced to consume more of their solar energy on site. Typically, the energy generated by a landowner’s PV system does not match the profile of their usage, so “behind-the-meter” solutions such as smart meters and battery storage, are providing  new and more innovative solutions for power consumption;  placing more control over energy usage in the hands of  the landowner. This could become increasingly attractive if the uptake of electric vehicles continues to increase as predicted.

At a height of usually no more than two metres, solar developments can be relatively unnoticed, are particularly well suited to dairy and chicken farms by generating energy when demand is at its highest and enable livestock, such as sheep, to continue to graze on the grass underneath ground mounted panels. In the absence of any moving parts, maintenance is also low, resulting in a lifespan of up to 40 years, offering a low maintenance long term investment.

This industry has survived the removal of government subsidy, and has not only stabilised to see the UK’s first subsidy-free solar farm, but arguably witnessed a clear shift with one of the UK’s “big six” energy providers making a long term commitment to solar, demonstrating that solar in a post-subsidy world really is possible. Whilst challenges within the industry clearly remain, as deployment costs decrease and battery storage becomes more affordable, arguably the future has never looked brighter for solar energy in Scotland.

Iain Baird

Iain Baird

Associate at Brodies LLP
Iain specialises in property energy work and has a broad range of property experience acting for both developer and landowner renewable energy clients with a particular focus on onshore wind, solar and battery storage.
Iain Baird

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