Wednesday, 4 September 2019

Solar Thermal Innovators

Are These Solar Thermal Entrepreneurs Going to Move the Dial for Solar Thermal?

At the "Setting Sights on Scottish Solar 2019" conference this week in Edinburgh,  we heard from three individuals that are hoping that their innovative ideas are going to set the solar thermal market alight again.

Since the glory days of 2010 when, according to statistics from the Solar Trade Association, the UK installed nearly 90,000 square metres of solar thermal panels the market has reduced in size every single year.  Only 7,000 square metres were installed in 2018.   In an introduction to the session, the Chair of the STA's Solar Heating Working group, Dr Richard Hall revealed that this is not simply a UK phenomenon - solar thermal is in retreat in almost all international markets.

Annual solar thermal sales in the UK according to statistics compiled by STA

Solar PV panels continue to decrease in cost and increase in power output.  Excess PV-generated electricity can be inexpensively diverted to heat hot water in your tank via its immersion heater but can also charge large batteries to provide evening electricity use, and prevent a trip to the petrol filling station by topping up your electric car.  Where is the place for solar thermal in this brave new world of smart electricity grids and electricity 'pro-sumers'?
Our three brave entrepreneurs each believe that they have found a new angle that can make a difference to the appeal of solar thermal panels.

Image: SolarisKit

Faisal Ghani of Solariskit  sidesteps the problem of declining traditional markets for solar thermal by attempting to create a completely new market for solar water heating in sub-saharan Africa and other hot countries.  His 'flat-pack' solar panel features a black slinky hose arranged in a conic spiral and contained within a clear plastic pyramidal cover.   It is intended to be low-cost and simple to install and maintain.

solarblogger says: Faisal has come up with a really striking geometry for a solar collector and it is clear that the material costs could be low, if SolarisKit can get enough volume in manufacture.  It's low-weight, flat-pack design will doubtless be helpful for supply chains across rough terrain.  However it will be up against the most cost-effective of solar thermal panels - the thermosyphon Chinese combi systems that include a panel and an outdoor cylinder at rock-bottom prices.

Image: Soltropy

By contrast, Stuart Speake from Soltropy thinks that dairy farmers with a large hot water demand are ideal customers for his solar panel, and his business appears to be the furthest along of the three in that is financed by product sales rather than investors and grant money.  Soltropy's evacuated tube solar collector is freeze tolerant.  Water heated by the evacuated tubes as it is pumped along a copper header pipe returns down a second pipe made from a flexible, compressible material that runs inside the first.  If the water in the pipe freezes, the inner compressible tube is squashed up to prevent the pressure build up that would normally cause pipes to burst in freezing weather.  A solar thermal system that does not require antifreeze has greatly reduced maintenance requirements.

solarblogger says:  I love this idea- it achieves the same goals as the old Solartwin freezable absorber, but elegantly avoids that product's serious performance compromises by removing the compliant tube from the heat transfer pathway.  There is no doubt that the breakdown of antifreeze over time is the source of many of the reliability issues of solar thermal, and that many customers simply don't do preventative maintenance on their solar heating systems.  Being able to reliably remove antifreeze from solar thermal is a big step forward, but I'm not sure that on it's own it is enough to change the fundamental attractiveness of the technology.

Image: Senergy

We also heard from Christine Boyle of Senergy, whose company has developed an all-polymer solar thermal panel.  The absorber, fluid flow channels and panel sides are extruded from specially developed material consisting of  carbon nanotube loaded polymer.  This new material has high softening temperature compared to most other plastics, improved thermal conductivity and increased strength. The latter of these properties of the material allows it to be made with thinner walls which also enhances heat transfer to the working fluid.

The extrusion is finished off with injection moulded end-caps to complete the fluid circuit and a clear polycarbonate coverglass is added on top.  There are inevitably some performance penalties compared to conventional solar collectors, the insulation is de-rated to limit the stagnation temperature and the absorber is not spectrally selective.  The energy yield will be reduced to some extent for most applications, but  Senergy claim that their panels are 50% of the price of regular solar thermal panels, which if it is borne out would represent a very significant saving.

solarblogger says: All-polymer panels have been seen as the holy grail of low-cost solar thermal by many people for some time.  Other advocates include Aventa Solar from Norway, which has developed an all-polymer absorber, but I really like the design for manufacture that Senergy has come up with.  However, I remain pretty sceptical that a lower panel cost will be a silver bullet for solar thermal.  Conventional solar thermal panels  made in vast quantities, for example by GreenOneTec  leave the factory for less than EURO 100/m2.  Consequently the manufactured cost of the panels represents less than 10% of the price of a typical domestic-scale installation, with other costs such as customer acquisition, roof access, piping, insulation and controller accounting for the rest.

So what do you think, are these three solar thermal innovators going to be the next big thing or are they trying to push water uphill in such adverse market conditions for solar thermal?

Friday, 5 April 2019

Why Choose a Career in the Solar Industry?

Why should anyone take a job in the solar industry?  It may seem like a strange time to be talking about a skills shortage just after Feed in Tariffs have closed, government is yet to set out a clear route to market for exported electricity, and in the week that Ikea pulled its domestic solar offer in the UK.

But that's what I'm hearing from colleagues.

They talk of job adverts sitting open for months on end, difficulty getting electricians to take roles in solar and people moving out of solar divisions and back into regular M&E contracting or roofing.

The challenge, I believe, is one of perception - that solar is just a fad - lots of installations while the government paid for them, but all gone today, right?

Feed in Tariffs were cut, and cut again, and have now been taken away.  Solar farms once popped up like mushrooms and then years went by without ground being broken for a new one.  Taxes have been imposed on businesses with solar panels, higher electricity standing charges are proposed for people with solar on their homes.  Solar boom then bust, and bust and some more bust is the diet that the news media has fed the public.  Little wonder colleagues across the industry are saying that attracting talent right now is proving to be a challenge.

Our industry has driven forward at a pace that has regularly sent waves of panic through those government departments tasked with supporting the transition to a green economy.  Support scheme after support scheme that looked well-designed and rational when announced were quickly overtaken  by the relentless and rapid innovation of the solar sector.  As solar costs fell, financial returns rose, deployment volumes exploded and government support schemes ran out of money.  Spain, Italy, Germany, UK - the list of countries rapidly back-tracking on support schemes goes on.

Economies of scale, automation of manufacturing, ever-higher solar panel efficiency, new financing models, reduced risk for investors - all these have driven down the cost of solar and increased the financial attractiveness of the technology.  Crucially, this happened at a speed that governments were unable to respond to.  The result was often a knee-jerk approach to policy development.

Our industry has often, by necessity, been complicit in the tone of the media coverage, publicly regretting the reckless treatment of theindustry by our government, while at the same time talking up the long-term prospects.  Inevitably, press coverage focused on the negative messages.  Faced with cliff-edges created by government flip-flopping, what would you expect a solar installation business to do, apart from tell people to 'get in quick' before they take it away?  Regrettably, the industry's own marketing has also helped create the message that solar is only a 'fad'.

No more!  The era of solar as 'subsidy-junkie' is over.  A tipping point is already here.  In more and more applications, in more and more climatic zones, solar stands without need for grants or support schemes.  Every new innovation that drives down the cost of solar energy simply expands the number of applications where it pays for itself and grows demand for solar equipment, installation and maintenance services.  As demand grows, economies of scale increase, which drive down costs again and a virtuous circle is created.

In sunny climates solar already competes with all othersources of electricity generation at wholesale prices.  In less irradiated places like the UK solar-generated electricity is cheaper than retail electricity, particularly large scale solar applied to commercial buildings or as ground arrays with an energy supply agreement with a large consumer of electricity.

For new buildings reaching for ever higher energy efficiency standards and for low energy refits of existing buildings solar is a necessary demand-reduction measure, reducing electricity consumption from the grid.

Millions of new electric vehicles will achieve similar results for the cost of batteries.  These vehicles, each with a range that far exceeds most people's daily requirements, will store electricity generatedduring the day and release it at night, enabling ever-higher quantities of solar on the electricity grid.

As well as electrifying our transport, it is now widely accepted that the heating of our buildings must also be electrified.  In a move away from carbon-emitting gas and oil - we will be using either heat pumps or direct electric heating and high levels of thermal insulation to keep our buildings warm.  Demand for electricity will increase significantly - greater efficiency of appliances and gadgets will only offset the increase in their number.

So the future for solar is bright.  Anyone considering a career move into the solar industry should consider the following points:

  1. They would be joining a growth industry with strong fundamentals, an industry that will support a long career. 
  2. Work that provides meaning and clear social benefits is more and more important to everyone, but especially younger people setting out on their careers. The solar industry offers socially rewarding work, where you feel part of the solution rather than part of the problem in the fight against global climate change. 
  3. Roles in the solar industry offer transferable skills such as project management, risk management, international supply chain development, electrical and structural design.
  4. You will become more popular at parties!  When asked 'so, what do you do?' the solarblogger can attest that saying you work in the solar industry is a real conversation-starter, in stark contrast to the conversation-killer of a previous job in 'instrumentation for genetic analysis'....

So what do you think?  Are you finding it difficult to recruit?  If so, what do you think the industry could and should do about it?

Sunday, 17 February 2019

The Smart Export Guarantee Scheme (SEG)

Why is central government continually surprised that when the big energy companies are asked to ‘do the right thing’, they instead do what is right for them?

Central government seems to love handing responsibility for delivering energy reduction targets over to the big energy suppliers.  The scheme names come and go -  CESP, CERT and ECO – but the common factor has been to require energy companies to invest in energy efficiency measures such as loft insulation, and cavity wall insulation for homes.

Pause for a moment to think about it.  You’re asking a business to do things to reduce demand for its own product – energy.   How surprised should be we be that that foot-dragging, missed targets and ineffective measures have been the result?

In 2014, many of the energy suppliers were fined for failing to meet their targets to install insulation. British Gas was fined £11million, a development which their PR department brazened-out as a charitable donation.  One is left wondering if the energy companies see these fines a small price to pay instead of helping people spend less on energy.

With the government's new proposals for a Smart Export Guarantee (SEG) are we again about the make the same mistake by asking the big energy companies to decide what the ‘market price’ for electricity exported by householders and businesses with solar panels?

Why we Need a Smart Export Guarantee

Many people in the solar industry that I speak to have pretty mixed feelings about the Feed in Tariff.  They recognize the transformative effect of 19 years of subsidy on the industry, helping it to achieve scale and cost-competitiveness with fossil energy.  At the same time, they regret the reckless way that the scheme has been managed.  Successive ministers at DECC and then BEIS have inflicted real pain on many good people who had invested their time, energy and money in solar businesses an effort to be part of the solution.

As a consequence, the industry is genuinely looking forward to a future where it no longer needs ‘help’ like that from government and the technology can stand on its own feet as a significant contributor (maybe the dominant contributor worldwide) to the clean energy revolution.

It remains crucially important for the sector that householders and businesses that invest in solar are able to sell generated solar energy that they cannot use themselves.  This makes possible efficient and cost-effective solar systems that minimize the cost of energy rather than being sized to just meet demands in the building at times of peak output.

So, as the Feed in Tariff (FIT) draws to a close on March 31st, government is consulting on a new scheme, the Smart Export Guarantee (SEG) – that requires larger energy suppliers to purchase excess solar energy from small generators at a fair market price.

There is much to welcome in the proposals for SEG
  • the Microgeneration Certification Scheme is thrown a life-line as the only way to qualify,
  • there is to be no requirement for the building to achieve a certain energy efficiency level (EPC), a requirement in FIT that excludes many older and listed properties
  • installations that occur after the FIT closes but before the SEG is available will be able to join the SEG as soon as it opens
  • export will be metered and not estimated (as in the FIT), rewarding people that install larger systems
  • a central database of solar installations will be maintained beyond the FITs
  • the high price for bought in electricity compared to the low value of exported will encourage the deployment of battery storage and electric vehicle charging (when compared with other arrangements, for example net metering)

Concerns About the Detail

However, there are two big concerns with the proposals as they currently stand:
  1. Smart metering IT systems are not up to the job at present
  2. The reliance on conflicted businesses to set a market price

Smart Metering Systems

At recent Solar Trade Association meetings we were astonished to hear that the SMETS1 smart meters that have so far been installed ‘go dumb’ as soon as you change supplier.  Although second generation SMETS2 smart meters fix this problem, the IT infrastructure that collects the data is not yet ready to a point where this data can be shared between an energy supplier and a separate company that you have signed your SEG deal with.

It would be just like government to say ‘well, we’ve done our bit’ as they launch a completely theoretical SEG scheme, which nobody can use in practice because the billing arrangements are not ready.

That’s why we need something - dare I call it a ‘backstop’ - that makes the SEG work from day one and creates an incentive for energy companies to sort out the IT, rather than having a strong incentive to drag their feet and take as long as possible to prevent the SEG ever happening.

A backstop could look a lot like the export tariff part of the current Feed in Tariff:

  • A fixed value, for example £0.04 /kWh
  • A deemed export 50% of generation 

This would create a strong incentive for the energy companies to pull out their fingers because they are likely to be over-paying for generation where they cannot meter it.

Setting  a Market Price

Electricity costs vary during the day as supply and demand varies.  The industry would be absolutely delighted if export was paid a fair market price at the time of export – that is a price set between a willing buyer and a willing seller.

The preferred option in the SEG consultation is to simply leave it to the energy suppliers to set the price, with the only control being that the price is higher than £0.00

My concern is that the proposed mechanism will not result in a fair market price, because the companies that are being relied upon have every incentive to keep the amount of solar installed as low as possible.  They are conflicted because every time a household or business installs solar it will buy less power from the energy suppliers.  Setting a higher price for exported energy would make solar a more appealing investment and harm the business models of the energy suppliers.

The energy companies do not meet the requirement of being a ‘willing buyer’ for the power and a fair market price will not result. There is a market failure and government cannot leave pricing the invisible hand of the market – except that it can, it just needs another way.

The ‘market’ already sets a price for electricity – and one that is free from the conflicts set above.  For example market exchange Nordpool publishes day ahead pricing for wholesale electricity on an hourly basis.  These prices could be better taken as the ‘market price’ for electricity between a willing buyer and a willing seller.  Energy companies should be required to purchase from microgenerators at the wholesale market price.