Wednesday 23 May 2012

Peak Toil - Update on UK Photovoltaic Market

Challenge to Business Studies students:

Look at the chart above and write a business plan to create a sustainable long-term business based on photovoltaic solar in the UK.  Your plan must take account of the fact that the spikes are randomly imposed by the actions of the greenest government ever, determined as it is to help the industry by continuously "improving" the Feed-in-Tariff, the grant scheme that creates the demand for your products and services.

This is an update of an earlier chart showing the effects changes to the Feed in Tariff (FIT) have had on installation rates of solar PV in the UK.

Worried that they would over-spend the Treasury budget cap for the FIT, the government announced its intention to cut the subsidy in half from December 2011.  The ensuing rush of installations to get in before the cuts was followed by a second peak at the end of March 2012, as it became clear that the government had acted unlawfully with it's first date, and the new FITs would come in from March 3rd.

A third mini-peak erupted in the run up to April 2012 as another change was made to the FITs requiring that houses should have an Energy Performance Certificate (EPC) with a rating of D or higher to qualify for the FIT.

Following the third deadline, solar PV installation rates have remained stubbornly low, despite prices for PV having fallen to a level that means the return on investment is apparently similar to that during 2011.

The current Feed in Tariff rates and requirements can be found here.