Check against delivery
It’s a great pleasure to be here today to launch the National Solar Centre and mark a real mile stone in the development of the sector.
The last two years have seen the industry go through an extraordinary period of growth but also face the most enormous challenges.
I know just how difficult recent months have been for many of you but the industry has come through this testing period – and has definitely emerged leaner, wiser and certainly larger!
1.8GW of solar PV is now deployed and in operation in the UK – enough energy to power around 450,000 homes. Three times as much deployment as was anticipated by the original, unreformed FITs scheme.
Now, as we prepare to pass the 2GW threshold, we can rightly say that solar is coming of age. It is reliable, accessible, increasingly affordable and totally scalable.
My department has also been through a steep learning curve too. With the help of many of the people here today, we have brought solar into the mainstream of the UK energy mix, solar is now rightly recognised as one of DECC’s priority renewable energy technologies and an essential part of our energy future.
But we are now standing at a crossroads.
The Coalition’s new Energy Bill is set to revolutionise the investment opportunities in renewables – delivering a fundamental change to the way we generate power in the UK to 2020 and beyond. Solar must be part of that.
So there could be no better time for the National Solar Centre to launch, to ensure the industry is in the best place to be an important part of the UK’s energy mix.
Thanks to dramatically falling costs, costs that will….and must, fall further, solar PV will play a critical role in helping the UK meet its vital renewable energy targets. And we in the Coalition Government are absolutely committed to working with you to make that happen.
At Christmas, the Renewables Roadmap Update set out our ambition. We have the ability – and more importantly, the ambition – to see a 10 fold increase in solar power by 2020.
20GW is a big, bold and transformational goal. But to achieve such a dramatic shift, we will need a real partnership:
- Partnership between the Coalition Government and the private sector
- Partnership between manufacturers and developers
- Partnership between academic research and those deploying solar in the real economy
- Key to this will be a continued drive to reduce costs
Whether that’s innovation to bring down the costs and increase the efficiency of solar PV products, a critical mass of activity which brings economies of scale, more cost-effective installation process or innovative financing. All these drivers will need to play their part.
But to achieve this potential, the sector also needs real champions; champions with the vision, the ambition and the resources. To lead the charge on the next stage of the solar power revolution.
The National Solar Centre can be at the spearhead of this effort.
So I want to be clear today about what I believe the National Solar Centre can achieve.
But first let me reflect on how far we have already come – warts and all.
The last year
This last year or so has been a difficult period of adjustment.
The levels of deployment under the original FiT tariff simply wasn’t financially sustainable at that level of deployment, and the bumper double-digit 25-year returns funded from energy bills of consumers already struggling with the cost of living were in danger of bringing not just the scheme, but the whole industry, into disrepute.
Now the industry is not to blame for that. That lies squarely on the shoulders of the architects of the original scheme. But while I believe we had no choice but to act, it wasn’t easy or itself without difficult consequences.
But despite all the adverse publicity these changes generated, one fact remains true. Solar is still a great deal.
There’s been much disinformation out there on how solar is now just uneconomic and unaffordable.
The opposite is true. Unit costs have fallen dramatically. And it’s worth underlining – the rates of return under the new bands actually remain broadly similar to those when the FITs scheme was first launched in 2010. Together, we need to get that extremely positive message out to the wider public.
This message is starting to feed through into real-life activity. This last week’s installation figures under the FiT have shown encouraging signs that the market is stabilising with nearly 1500 installations equating to 5MW. Now we have a long way to go to drive up levels of deployment. But the industry isn’t flatlining.
What’s more, we are determined that the new subsidy levels under both the FiT and the Renewables Obligation (including the enhanced band for building mounted solar) should set the solar sector in the UK on a predictable and sustainable long-term footing.
But subsidies alone will not deliver what the sector needs.
That is why I am working hard in DECC to make sure our new Solar Strategy is ready for launch in the spring.
And I will be working closely with the industry to make sure that sets out a real, meaningful programme for you and us to work together. To ensure that I will be setting up a new formal process by which the sector can feed into the strategy. Through it we can, together, identify the critical barriers standing in the way of achieving our shared vision for solar in the UK and work together to overcome them.
2013 is an important year for the economy, as we do everything we can to drive responsibly sustainable growth in the economy. I want solar to be part of Britain’s growth narrative.
I want the industry to embrace the changes taking place. There are real opportunities here for you to…
- Use the Green Deal to market Solar PV as an energy saving option.
- Use the commercial Green Deal to drive solar’s part in the distributed energy revolution. Offering companies from SMEs to FTSE Giants solutions to generating more of their own electricity, building greater resilience and certainty into their business models as they go.
- Take opportunities to capture new markets with the support of Government. For example over the coming month I will be hosting a series of networking events where the sector can sell its pitch to some key potential customer groups – Registered Social Landlords, Local Authorities, the Building Sector.
- Key to seizing these opportunities will be getting the message out, mutual supportive action to help the industry grow and develop in a sustainable way.
This is where the National Solar Centre comes in.
The National Solar Centre
I am delighted to announce the creation of the new National Solar Centre (NSC) at St. Austell, Cornwall in April this year.
The new National Solar Centre (NSC) will play a pivotal role in supporting the solar industry not only in the UK but with International Renewable Energy Associations.
It will help establish infrastructure for industry growth in developing Technical Standards, Due Diligence, Best Practice Planning Guides, Training facilities and driving innovation through R&D.
Innovation, of course is fundamental to the development of any industry if we are to realise our growth potential and break down the barriers to deployment. There are really exciting opportunities for the solar industry and we’re seeing them happening now.
Innovation has always been one of the UK’s great strengths. For example, I recently toured Romag’s factory in the North East but while I was there also visited Naked Energy.
Naked Energy is an award winning British design and innovation company. They are developing “Virtu” – a revolutionary hybrid solar panel that generates both electricity and heat for commercial and residential applications. They should be bringing the technology to market during 2013.
That’s precisely the type of innovation we need to see.
The support the NSC will provide for companies who are developing new and innovative solar products, will provide an excellent opportunity for UK manufacturing and job creation.
Solar also needs to build links with other sectors that are key to the industry’s success. The UK has the expertise to influence new and emerging markets and benefit from “solar going global”, and we believe the centre will be an important catalyst in making this happen.
We welcome the commitment which the Building Research Establishment (BRE) has shown in driving this forward, and value the vast experience they will bring.
Making concrete links between the Solar PV industry and the Building and Construction sector will assist the solar sector in taking its place in the mainstream generation market.
I particularly like to thank Ray Noble for his tireless work over many years to support the development of the solar sector in the UK.
It’s probably fair to say that, without his drive and vision, we wouldn’t be celebrating this launch today. I can’t think of a better person to be heading up this important new initiative!
In conclusion Ladies and Gentlemen, there are still real challenges ahead if we are to achieve our 2020 Vision of a vibrant UK solar sector.
We must commit to working together – Government and industry – to make it happen.
The new incentives which are now in place should provide the foundation on which the sector can build deployment. Whether:
- A householder looking to reduce their own bills.
- A company looking to take better control of their own energy usage
- Large scale PV on brownfield sites.
Government will continue to work with the sector to get the message out there that solar is now on a firm footing to build deployment and a ‘go-to’ solution for energy generation.
We are committed to supporting a sustainable PV industry in the UK.
Industry must do its bit driving down costs through relentless innovation.
But working together we can bring about a solar energy revolution in the UK.
- A win for consumers.
- A win for British business.
- A win for the economy as a whole.
- And a win for the future of our planet.