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Regulatory uncertainty has “damaged” subsidy-free solar projects, the Solar Trade Association (STA) has said in response to Ofgem’s Decarbonisation Action Plan.
Issuing ten recommendations to the regulator, the STA said it should endeavor to algin reform processes where possible, pointing to how this didn’t occur for the Targeted Charging Review (TCR) and Access and Forward-Looking Charges SCR.
Failure to align these reforms and regulatory uncertainty, it said, has “damaged” the prospects of delivering new subsidy-free solar projects.
Research from Aurora Energy Research found that the TCR could delay the onset of subsidy-free solar in the UK by as much as five years, with Ofgem publishing its final decision on the TCR in December 2019.
However, a number of industry players have confirmed their intent to develop subsidy-free solar in the UK, with the first few projects beginning to come online such as NESF's 50MWp Staughton site, which it claims is the largest in the UK.
In its reponse to Ofgem's plan, the STA continued to say it is not sufficiently clear and should have a longer term focus, as “an 18-month framework is insufficient to provide the overarching, holistic approach toward decarbonisation that is needed".
It is lacking in incentives for decentralised renewables, with the association recommending that all forms of renewables and sources of low carbon flexibility are sufficiently incentivised through the next network price controls and regulatory framework.
It continues to recommend Ofgem use modelling, facilitate innovative regulation and to enable continued commercial operation of existing renewable assets connected to the grid, as well as those receiving subsidies such as Renewable Obligation Certificates and feed-in tariffs through “ensuring a fair, transparent and prompt audit process".
Cameron Witten, policy manager at the STA, said the plan has “several omissions” that relate to renewables and energy storage that are “mission critical to accelerating the deployment of solar”.
“It is essential that Ofgem carefully considers how it will evolve Britain’s power networks to ensure solar and other decentralised low-carbon technologies can fulfil their part in decarbonising the energy sector, by tackling significant barriers, including grid connection difficulties, generation constraints and disproportionate network charging,” Witten continued.
The regulator also needs to lay out how the progress of the Decarbonisation Programme will be tracked and monitored, ensuring there is an opportunity for feedback.
In addition, the STA is calling on the government to provide Ofgem with an updated and clear Statement of Policy and Strategy in line with net zero.
Finally, the STA encourages Ofgem to work with the Department of Business, Energy and Industrial Strategy (BEIS) to develop a follow up to the Renewable Heat Incentive (RHI) that allows solar heat and power generation to scale.