Chris Sparkes, lead technician at UK solar installer Solar Fast says pv magazine Just throwing money at the solar industry is not enough.
One such announcement is the Green Prosperity Plan, which promises £28 billion ($35.4 billion) a year in clean energy jobs and infrastructure.
Did I say £28 billion? That’s actually just £20bn of new spending, according to the left-wing newspaper Caretakeraccording to which current Prime Minister Rishi Sunak has already pledged £8 billion for it.
As a solar technician, I have been asked many times what I think about spending plans. The simple answer is: I honestly don’t care – yet.
Throwing money at an industry does not bring wealth. At best, it provides a short-term, expensive boost to speed up some projects that probably would have happened anyway. At worst, it becomes a headache for public spending, and the money may not even be sent where it needs to go. Just ask Spain and China.
Consumption is not nearly as important as a plan developed together with industry.
Carrot and stick
As climate scientist Michael E Mann constantly repeats: Action stems from both a sense of urgency (the need to act soon to secure a decent future) and willpower (a sense that we can make a difference). I consider urgency a stick and willpower a carrot.
Green infrastructure policy must take both factors into account. If a company doesn’t have a representative, it can’t do solar, usually because of the expense. If the company is not in a hurry, the solar energy is taken out of the way.
An excellent green policy changes business models to reduce investment and create a friendly environment for sustainable industry.
Markets and the sun
The tumultuous reign of Boris ‘Partygate’ Johnson brought politics where the carrot and the stick went together surprisingly well.
The carrots, which include up to 130% super relief on first-year capital expenditure for businesses and 0% VAT on domestic solar installations, reduced payback periods and upfront costs, making solar more accessible.
Skyrocketing energy costs and alarmist headlines were factors that boosted solar installations by 114% this year, on top of continued year-over-year acceleration.
Australian Labor Party
By comparison, solar installations in Australia slowed last year despite a federal election that ousted an environmentally destructive coalition government.
Newly elected Labor Prime Minister Anthony Albanese raised the hopes of the green industry, but only the conversation at the top has not changed.
Australia’s 2022 Climate Change Act may have set more ambitious emissions reduction targets in the legislation, but it doesn’t give the solar industry anything to sink into.
The nation is limited to state-level tax incentives and grants. All carrot, no stick. This is why a UK Labor government may not be a silver bullet for solar problems.
Inflation Reduction Act
Few are paying attention to Australia anyway when the White House is throwing hundreds of billions of dollars. US President Joe Biden’s IRA (Inflation Reduction Act) has received a serious reaction from the EU, which wants to protect its green industry.
The IRA is the first major climate bill to pass both houses of Congress.
Labour’s £28 billion pales in comparison to Biden’s $385 billion in clean energy tax breaks and incentives, doesn’t it?
Again, it’s what you do with the cash that counts.
Tax incentives are fine for public utility projects in a stable, congressionally approved operating environment, but I think the solar revolution will primarily be a war of attrition targeting unused rooftops and promoting decentralized, local grids.
Otherwise, we are simply asking for grid problems because we need huge additional costs to cope with fluctuating output from solar and wind farms. This is something that hadn’t even begun to be addressed in the United States until the authorization reforms were smuggled into the agreement recently signed by Biden and Speaker of the House Kevin McCarthy to raise the nation’s debt ceiling.
The Labor Party’s Wish List
Here are some ideas on what should be included in the next UK government’s green spending plans.
First, tariff reform.
As the UK’s grid operator National Grid notes in its “Live Report”, peaks in electricity demand at peak times cause spikes in fossil fuel production, as well as wasteful off-peak generation when the sun is shining but demand is low. Few energy companies encourage off-peak use, except for electric car owners. Labor should encourage them to drive this, to increase the demand for renewable energy.
Tariff reform could be developed in conjunction with an education program that informs the public that it is not just about adding, but about manipulating peak usage to maximize consumption that already exists.
This would help harmonize the relationship between the grid and solar developers and promote a more inviting permitting environment.
Pay the difference
Second, more should be done to reduce fossil fuel production.
Raising taxes on the public, such as fuel taxes and carbon taxes, is rarely popular, as seen in Canada and France. The workforce must walk carefully, but with a stick Is necessary. The new government must illustrate the catastrophic impact of fossil fuels on consumer and business electricity bills by emphasizing the difference between energy sources.
Labor needs to decouple energy prices for the coming year from fossil fuels so that suppliers sourcing cheaper, cleaner energy pay significantly lower wholesale prices, which can then be passed on.
If this can be achieved, fossil fuels would quickly be deemed economically unviable.
Finally, solar electricity should be accessible to everyone.
Solar energy is a huge investment that is out of reach for commercial and residential customers without significant savings. This leads to an “us and them” situation where green investment is seen as a middle-class luxury that benefits those who need it least.
The workers’ money should be used for that. The party could give Britain’s state-owned Infrastructure Bank a mandate to offer ultra-low-interest loans to solar installers, with repayments based on reductions in electricity bills. This would mean that customers and companies would have no risk of upfront costs or rising energy costs. That would be pointless.
Really green consumption
These proposals, effectively fleshed out, would be a wonderful mix of carrot, stick and business model reform rather than focusing on headline-grabbing numbers. They may not be as spectacular, but it makes me excited for the next election.
About the author: As a former science teacher, Chris Sparkes has always enjoyed sharing his passion for the inner workings of renewable energy systems and their wider impact on energy transition and climate change. He now works as a senior technician at Solar Fast, a UK-based solar installer.