Solar reaching parity in UK market

22 December 2018

The UK’s Solar Trade Association (STA) says that a “significant solar pipeline” is expected to start development thanks to falling equipment costs.

The organization’s latest analysis shows that large-scale solar photovoltaics will deploy in 2019 at a Levelised Cost of Electricity (LCOE) of £50-60/MWh.

The anticipated LCOE is below the level of £80/MWh forecasted by the STA in 2014, and also makes large-scale solar competitive highly competitive with CCGT and onshore wind, and attractive for commercial and industrial consumers under long-term Power Purchase Agreements.

The fall in LCOE is largely attributable to the removal of import tariffs imposed on Chinese solar modules by the European Commission, as well as a global module surplus. Several developers have unveiled new large-scale solar projects in the UK, while others are examining the feasibility of older projects that were permitted but never built.

Large-scale solar has been excluded from clean energy auctions in the UK since 2015, and the Renewables Obligation was closed in March 2017. 

The absence of subsidies for solar energy meant developers were unable to bring projects to market, but the outlook has improved, STA says.

Chris Hewett, Chief Executive of the Solar Trade Association said: “We have a clear message for Government and corporate energy buyers today: UK solar electricity is now cost competitive with fossil fuels. By establishing the right policy framework for solar and storage, including expediting a smart, flexible energy system, government can enable this technology to realise its full potential in delivering an affordable, low-carbon future energy system.” 

Recently unveiled projects include Hive Energy’s and Wirsol’s proposed Cleve Hill development, which could include up to 395 MW of solar capacity and 600-700 MWh of storage.

Lightsource BP says it has a development portfolio of 300 MW in the UK.

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