The Government has this morning announced how much money will go to different low carbon technologies between now and 2020 under its new Contracts for Difference system.
Only £50m will be available per year for hydro, energy from waste, onshore wind, landfill gas, sewage gas and large-scale solar. Even if all of this went to solar – which it won't – this is only enough for 1GW of solar in this round, a considerable reduction on the current market.
Leonie Greene, Head of External Affairs at the Solar Trade Association, commented:
"The message the Government is sending out today is clear. It is backing nuclear and other more expensive renewables over value for money solar".
"This is an absurd decision that will ultimately hit energy bill payers across Britain. Solar is already cheaper than offshore wind; it will soon be cheaper than onshore wind, and it stands a realistic chance of being cheaper than gas by the end of the decade. But this is only achievable with stable Government support and a level playing field."
"Today's decision shows the Government is stacking the deck against solar, the most popular form of local energy, by starving the industry of resources. The sheer complexity of the new Contracts for Difference policy mechanism disadvantages small and medium sized solar businesses who are entering a game of three dimensional chess against multi-national utilities. Critical requirements for small and medium businesses have been ignored."
"The point is that only large scale solar, which was on track to being subsidy-free, is being exposed to this new Contracts for Difference system without having the back-up of the old scheme. The Government needs to fix that by guaranteeing a minimum amount of funds for solar."
"The solar industry is not asking for special treatment – just a level playing field for solar and for small businesses, who provide much needed competition."
Critically, the £50m available for this year is available for all years to 2021. This means solar aiming to be built next year could be competing with wind to be built in 2018/19 when it is not ready to compete.