United Kingdom’s Solar Market Fastest Growing in 2010
The sun is rising on the United Kingdom’s solar market in 2010, asattractive government incentives make it the world’s fastest-growingcountry for photovoltaic (PV) installations this year, according toiSuppli Corp.
Installations of PV systems in the United Kingdomwill amount to 96 Megawatts (MW) in 2010, up an astounding 1,500 percent from 6 MW in 2009. While the country’s growth will start from a nearlynegligible level in 2009, the expansion will dramatically outpace thegrowth of the next fastest-growing nation—Spain—which will rise byapproximately 730 percent in 2010.
“When you think of weather in the United Kingdom, London fog comes to mindmore readily than bright sunshine,” said Dr. Henning Wicht, seniordirector and principal analyst for iSuppli.
“However, thingsdefinitely are looking brighter for the solar market in the UnitedKingdom in 2010, as the country has adopted attractive Feed-in-Tariffs(FIT) to promote PV adoption. Furthermore, with leading solar countryGermany cutting its FITs, the focus of the PV world is shifting toplaces with more favorable incentives—making the United Kingdom a solarhotspot this year.”
While growth in the United Kingdom isexpected to slow down from such a blistering rate after 2010, PVinstallations will continue to rise in the 50 percent range for eachyear through 2014.
Giving solar market FITs
FITs promote the use of solar energy by guaranteeing that utility companieswill buy excess electricity produced by solar installations. This helpsindividuals or organizations to defray the upfront costs of investing in a PV system.
Extensive use of FITs has helped Germany to becomethe world’s leading country for PV, with 3.8 Gigawatts (GW) worth ofinstallations in 2009. However, Germany government’s move to reduce FITs will cool off growth in the country from 2012 on.
Energy in the UK
The overall goal of the United Kingdom’s program is to encourage smaller,distributed, self-generation in an effort to reduce CO2 emissions and to contribute to the renewing of the UK energy park. The United Kingdom is using above-market FIT rates to incentivize PV adoption.
Theaverage residential price for electricity in the United Kingdom iscurrently 0.12 pounds per kilowatt hour (kWh). A residential PV systemof up to 4 Kilowatts (KW) in size can earn 0.36 pounds for everygenerated kWh that is consumed by the owner itself or 0.39 pounds forevery kWh fed into the grid. This translates into a financial benefit of 0.48 pounds per kWh for self-consumption.
According to theUnited Kingdom’s Department of Energy and Climate Change, a typicalhousehold that installs a well-positioned 2.5 Kilowatt (KW) system could save 140 pounds per year on its electricity bill. Installationsconducted since July 2009 can retroactively qualify for the tariff.Returns on Investment (ROIs) for advantageous residential projects canapproach 12 percent, iSuppli calculates.
iSuppli’s initialestimate is that the UK PV installation market will reach 214 MW in 2012 and 501 MW in 2014. This assumption is modeled after the ramp rates ofother countries and by accounting for the United Kingdom’s level ofinsolation, or the amount of sunlight it receives.
Image: The figure presents iSuppli’s forecast of annual PV installations in the United Kingdom.
Source: iSuppli, USA.
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