FAMED for its dismal climate, Britain is not an obvious pioneer of solar energy. But, in their efforts to maximise small-scale electricity generation and reach ambitious carbon-reduction targets, successive governments have bet heavily on the sun’s rays. The outlook for that strategy is increasingly cloudy.
In 2010 the previous, Labour administration introduced subsidies for all types of small-scale electricity generation. In practice that mostly means solar: 97% of the take-up has been to install photovoltaic panels. The coalition has added some “Big Society” rhetoric, exhorting individuals to be part of the fight against climate change.
The theoretical appeal of solar energy is glaring: it is clean and ubiquitous. But, like other efforts to increase localism, this one requires central intervention and financing. Anyone who pays the £12,000 that a standard panel system typically costs can expect a return of around 10% for 25 years: given Britain’s limited summertime, that’s a pretty easy living. More than 40,000 houses are now adorned with “green bling” (including Clarence House, Prince Charles’s London home, above).
Britain needs to increase its capacity for electricity generation because all but one of the country’s nuclear facilities, and half of its coal power plants, are due to shut by 2023. Gas is an obvious and affordable short-term fix. But the government has committed to ambitious targets to cut planet-heating emissions by 80% by 2050, compared with 1990 levels. That means using cleaner power; the question is whether solar is the best source.
Many other European countries deploy similar subsidies. But critics argue that solar energy can never play a central role in such a grey country. In Britain, consumption is lowest when the sun shines. And since the technology does not yet exist to store the electricity generated, conventional power plants are still needed during high demand. According to the government’s own projections, by 2020 all small-scale generation will only amount to less than 2% of current electricity output.
Solar subsidies are also expensive. The government estimates the net cost of small-scale generation will be more than £8 billion over 20 years—to be raised through higher energy bills. This makes solar subsidies regressive: poor people spend a larger share of their income on fuel than the rich. The perks, meanwhile, go to those with panels—often wealthier homeowners. So community engagement in the fight against climate change may have a flip side, predicts Dieter Helm of Oxford University: rising bills could prompt a backlash against climate-change goals.
The subsidy is designed to help make solar technology affordable by stimulating mass production and innovation. But the British market is too small to have much influence on solar-panel prices. And since the government recently cut subsidies to commercial solar farms, the policy now focuses on the least cost-effective examples of an inefficient technology. Worryingly, Britain’s energy regulator does not even collect data on how much electricity each subsidised household generates, which will make it harder to assess efficiency.
Meanwhile solar subsidies threaten investment in other renewables, and distract from efforts to persuade people to make their homes more energy-efficient. Perhaps Britain should have learned not to count on sunshine.