The UK solar market, despite the changing legislation, is expected to remain the most dynamic in Europe in 2015. Enertis has analysed the UK market and concluded that this market has become one of the largest in Europe for large ground-mounted solar PV plants, with 2,800 MW under the Feed-in-Tariff scheme and 1,840 MW under the Renewable Obligation (RO) scheme. Nevertheless solar projects above 5MW are no longer eligible for the Renewable Obligation (RO) scheme from April 1st 2015, the Contracts for Difference (CfD) are the only available supporting mechanism for larger solar PV projects. However, independent advisors believe that almost 10% of solar plants in the UK will miss the RO deadline, which in turn will cause penalties to developers who have made unrealistic promises.
The solar photovoltaic (PV) market in the UK has grown from almost nothing in 2010 to around 5GW of installed capacity by the end of 2014, said Enertis. To understand the scale at which solar PV has grown, it is worth mentioning that almost 1GW has been installed in the first semester of 2014.
The bulk of solar projects in the UK is expected to be comprised of sub-5MW ground-mounted plants and commercial rooftops. Those projects will be eligible for 1.3 ROC or Feed-In-Tariff (FiT) and the investments are projected to be highly profitable.
According to Enertis, during Q1 2015, there was a strong growth due to changes in legislation and in the second one, the industry will probably slow down significantly to pick up new commercial rooftops and sub-5MW projects from Q4 2015 and Q1 2016. Regarding 2017, Enertis is positive and states that it will probably be the year where very few large corporations with significant experience will dominate the UK solar market.
In fact, big UK players have already showed significant interest towards the development of large rooftops. Both British and foreign developers expect to enter or increase their presence in the commercial rooftop sector and play a major role shaping the UK solar market. However, this segment has to deal with more complex barriers of entry due to the fragmentation of the projects. Therefore, Enertis anticipates that only the more professional players will be able to achieve economies of scale despite these barriers and those who succeed will have a significant market share.
Enertis, which opened an office in the UK last year, has been involved in the UK market since 2012. At the end of 2014, it became one of the fastest growing consultancies with more than 30 projects under its belt, totaling more than 280 MW of large solar PV farms. This year, Enertis has worked continuously with different lenders, investors and developers that are participating in the country’s renewable energy industry.
Additionally, thanks to its unique internationally-accredited PV Mobile Lab and its experience with quality control, Enertis has conducted on-site testing of thousands of PV modules for UK-based projects.
In the segment of distributed generation and commercial areas Enertis hopes to draw on its long experience providing technical advice, acquired through the management of large portfolios of small plants in the US and Mexico, and to be able to apply this experience to the UK market.