UK solar news: 6 March 2012.

Solar Twin Ltd call for a bigger, better, greener solar thermal upfront cash subsidy.

We understand that the UK Department of Energy and Climate Change (DECC) have just held an industry discussion about the forthcoming closure (on 1 April 2012) of the Renewable Heat Payment Premium (RHPP) scheme which paid £300 to solar thermal householders.

The RHPP scheme was widely recognised as a failure, in that most funds were not taken up. This fact, combined with the solar electric PV FIT subsidy’s absurd over-generosity, so that PV has dominated the UK solar market for the past 2 years, while the solar thermal panel market is now a mere 20% of what it used to be. Solar Twin Ltd’s solar thermal panels are UK made.

Solar panel consumers and the UK solar thermal industry urgently need to know whether or not better support and a more balanced solar market will be forthcoming. To this end, here are our six top suggestions on the RHPP:

• Restore the RHPP right away. Its main failure was that it offered too little for solar thermal. Some solar thermal companies are even planning redundancies right now. In the last week, two UK UK solar thermal companies including award winning UK innovators and manufacturers Filsol has just gone bust. There must be no further delay.
• Retain the RHPP “fuel displacement requirements” as before (ie in relation to gas grid connection) for each technology.
• Pay a fixed sum of £800-£1200 for solar thermal. £1000 worked OK in Scotland, but certainly not in any gold rush sense, and there has been inflation since then.
• Timescale: initially plan for 12m (ie until 1 April 2013) or until the RHI is launched, if sooner.
• Incentivise PV pumped solar thermal with £200 extra, since it is demonstrably greener and also costs more to buy than just a bronze pump and a cable connected to a dirty power station. Several companies are finally going this way. Doing so would promote UK innovation and technology development in a conservative sector which has sometimes seemed rather reluctant to progress.
• Make RHPP payments from 1 April 2012 100% deductible against payments of any future RHI (at the final end, time-wise). This should keep any state aid problems at bay and contain budget runaway fears.

We have today passed these suggestions to DECC, who may want to consider making RHPP conditional on home energy performance (EPC level D minimum, as with FITS), but only after a 4 month lead-in period, to prevent initial further market stalling, as a quid pro quo in return for finally giving a decent package to industry.

Barry Johnston, MD of Solar Twin Ltd commented today: “With last week’s shocking closure of two UK solar thermal SME’s, including Filsol Solar, who manufactured in UK and who had a talent for innovation, there is more bleakness about the future in this sector than I have ever seen, despite the fact that spring (which normally brings in orders) is on its way. I do hope that there can be some good news soon. Frankly we needed a clear announcement (saying closing or not) 3 months before the cutoff time the cuts because many people are running stocks close to nil and obviously the re-order times for some key components are 13 weeks or more. Although DECC ministers are aware of this important issue, they seem surprisingly relaxed about its operational implications. Industry and consumers need an expanded RHPP to be announced, right now.”