Mr Daniel Bromley, Mr Christopher H Don, Dr Theodore D C Hobson, Dr Amanda J Hughes, Ms Leanne A H Jones, Mr Jacob Leaver, Dr Laurie J Phillips, Mr Kieran J Routledge, Dr Thomas P Shalvey, Mr Matthew J Smiles, Mr Luke Thomas, Dr Joshua Turner, and Mr Alexander J Wright ATFF0042
Written evidence submitted by Mr Daniel Bromley, Mr Christopher H Don, Dr Theodore D C Hobson, Dr Amanda J Hughes, Ms Leanne A H Jones, Mr Jacob Leaver, Dr Laurie J Phillips, Mr Kieran J Routledge, Dr Thomas P Shalvey, Mr Matthew J Smiles, Mr Luke Thomas, Dr Joshua Turner, and Mr Alexander J Wright – University of Liverpool
Summary
We are a group of researchers at the University of Liverpool studying new materials for photovoltaic solar cells and batteries. We are submitting this evidence to address the question in the terms of reference: what low-carbon energy sources are most likely to secure supplies of affordable and sustainable energy rapidly?
We feel that photovoltaic (PV) solar power has a crucial role to play in allowing the UK to rise to the joint challenges of the climate crisis and the impact of the war in Ukraine. The Climate Change Act 2008 and the subsequent 2019 amendment set out the ambitious but essential target to reduce the UK’s net emissions of greenhouse gases by 100% relative to 1990 levels by 2050. The Sixth Carbon Budget requires an emissions reduction of 63% from 2019 to 2035, on the way to Net Zero by 2050. In addition, the ambition to phase out fossil fuel powered vehicles by 2030 will require a 20-30% increase in clean electrical generation at a much quicker rate than has been managed previously.1
Current issues only serve to highlight what could have been with a more ambitious and sustained investment in renewables. Unsecure supply of oil and gas due to the Russia-Ukraine conflict and knock-on consequences of the market squeeze are driving prices to unprecedented highs. In contrast, renewables are not subject to this same level of geopolitical influence during their operational lifetimes.
PV is practical and popular across the whole of the UK, a fact unsurprising given that solar PV is currently on par with wind as the cheapest ways to generate electricity before subsidies, with the levelised cost of energy continuing to fall over time.2 Recent analysis has demonstrated that PV installations can generate profits for owners even in difficult situations such as on listed buildings.3 Once installed, the price of PV is also stable, since the running cost lies only in operations and maintenance and does not depend heavily on imports. This makes PV a crucial technology for developing a secure, sustainable and affordable energy supply.
Public support for PV is also high. In Winter 2021, 86% of the British public said they supported the use of renewable energy such as wind power, solar energy and biomass to provide electricity, fuel and heat. This figure has remained stable over the last quarter (87% in Autumn 2021), with solar being the most popular source. Opposition to renewable energy remained low, with just 1% of people saying they opposed renewable energy.4 As a secure, low-cost source of energy, increased investment in solar PV is a popular strategy that will pay dividends in the future.
The popularity of solar development is particularly strong for rooftop solar, where the multifunctional land use is seen as a key benefit. Support is less strong for utility-scale solar farms, but this can be countered by awareness of the potential for mixed use applications which utilise the space underneath the panels such as wildflower fields to increase biodiversity, grazing livestock for agriculture, PV as shading in car parks, and floating PV on reservoirs to reduce evaporation. Solar PV will also supply jobs, skills and supply-chain opportunities that are attractive to the public, especially as solar PV installations can be situated essentially anywhere in the UK, distributing these benefits widely around the country.5
Contrary to what some might think, the UK receives more than enough sunlight throughout the year for solar PV to be a practical source of energy for households. The average UK household uses around 3,880 kWh of electricity per year.6 To generate the same amount of electricity with solar PV would require an area of 16.6 m2, or about 1.5 car parking spaces.5 But most of the UK cooks and heats with gas, bringing total household energy use to around 15,900 kWh pa.6 This would require 68.2 m2 of modules,7 which means an area the size of a football pitch could supply the entire energy needs of around 100 homes.
On average, Germany receives only 15% more sun than the UK per m2 but has four times the installed PV capacity,7,8 so solar resource is not what is holding us back. The south of England, in fact, receives more sun than the average for Germany, and while the sunlight does decrease further north, the difference between Brighton and Edinburgh is only 20%, the equivalent of adding an extra 14 m to the width of the football pitch above (still within FIFA regulations). There is value in solar PV throughout the entire country.
Renewable-based supply is viable as the dominant source of energy in the UK, because even though scaling up generation from variable renewable energy sources (VRE) will increase the intermittency of supply, the impact can be minimised by load balancing, diversification of supply and energy storage. The UK is particularly fortunate to have abundant wind resources, but a mix of VRE that includes a significant fraction of solar will be more robust due to the ways wind and solar complement each other.
Solar availability is positively correlated with load while wind is slightly negatively correlated. However, a mix of the two is shown to be best matched to meeting demand.9 The effects of climate change will likely strengthen the positive correlation between solar and load if, for example, air-conditioning systems become more widespread.10 Furthermore, when looking at environmental factors throughout the year, wind speed and irradiance are anti-correlated to varying degrees, depending on location, i.e. less windy weather tends to be sunnier, and vice versa. A mix of 30% solar to 70% wind minimises variability overall, with greater proportions of solar serving to decrease winter variability at the cost of increased summer variability.11
For rooftop solar, the energy can be utilised directly, at source, by households. This ‘behind the meter’ energy does not need to enter the National Grid and so need not cause any concern for frequency stability, an advantage other energy sources lack. At a household level, the rollout of smart meters will also help with load balancing, as they enable variable tariffs which provide a financial incentive for household demand to match supply, reducing the balancing that must be provided from other means.
Transitioning to greater reliance on VRE will also require an expansion of energy storage capacity. This is essential for maintaining supply continuity over every time scale, from seconds to seasons. As with generation, a mix of storage solutions will be better than relying on a single technology to benefit from the advantages of each option. Pumped hydroelectric and compressed air are great for larger capacity long-term storage but have a low energy density and are dependent on geography. Batteries have a much higher energy density, and can be installed anywhere, but have a higher capital cost.12,13 Although it is worth noting that the price of Lithium-ion batteries has fallen by 97% since 1991,14 with most battery technologies predicted to drop by a further 50-60% by 2030,15 so the energy storage landscape may change as the technology develops. Battery storage is also increasingly used at a household level to compliment the installation of rooftop solar and can play a crucial role in balancing supply and demand.16
While the increased use of VRE sources poses some challenges, the adaptations in grid management will ultimately produce a more flexible energy system, that is more resilient in the face of adverse events such as severe storms.17 Investment in storage should therefore be ramped up as quickly as possible. We will not regret accelerating the implementation of a large, varied capacity for renewable energy storage.
PV can be rapidly scaled up to meet demand for low-carbon, secure, energy at low cost, especially if lessons can be learned from the feed-in-tariff (FIT), which over its 9-year lifetime, saw 6 GW of peak solar photovoltaic capacity (GWp) installed.18 These rates were strongly affected by the price of the tariff, peaking at around 150 MWp installed per month in December 2011 to March 2012, before the 1st round of cuts to the tariff.18 After this, around 50 MWp per month was consistently installed until Apr 2016,18 with further drops when the tariff was cut again.
At present, UK government data suggests a low rate of solar installation in recent years, with PV installed at a rate of only 19.8 MWp per month since the Smart Export Guarantee (SEG) was introduced in 2019.19 Although others argue this rate is higher, at about 51.8 MW a month,21 these are both a long way below the peak seen during the FIT heyday. Indeed, even if the higher rate can be assumed, at this rate only 8.1 GWp would be delivered by 2035, whereas 56.3 GWp would be needed to reach 70 GWp total, the ambition of the Energy Security Strategy.20 Of course, it is reasonable to ask whether the level of 150 MWp per month was sustainable, and for comparison, Germany reached an installation rate of 163 MWp a month in the period 2007-2008. But rather than peaking, the rate continued to rise until 2011-2012, when 680 MWp was installed per month.22 Indeed, as in the UK, the rates only dropped when the German feed-in tariff dropped below 20c/kWh from 2013,23 suggesting this was due to the changing financial climate rather than a technical limit to solar installation rates. This demonstrates the technical possibility of sustaining high monthly installation rates, something that could be replicated in the UK with an appropriate policy environment.
At present, the Smart Export Guarantee (SEG) acts as a replacement to the FIT, and as a policy, may be hoped to increase the rate of solar installation. However, The UK government impact report predicted it would only add an extra 12.4 MWp a year to the installation rate by 2026 (on top of the existing installation rate without government intervention).24 This would add an additional capacity of only 214 MWp total by 2035.24
The upshot of this history is that solar installation rates could practically be higher, but the SEG (in its current form) is projected to offer little incentive to increase these rates, and while expensive, the FIT was clearly able to incentivise much greater installation rates before being cut. Reaching 70 GWp by 2035 would require greater installation rates still, at around 361 MWp per month on average. This may seem like a high number, but in 2019, 320 MWp per month was installed in Germany,22 despite only around a 20% larger population than the UK. Ramping up to these kind of installation rates is therefore plausible and, given the comparable populations and solar resource between Germany and the UK, there is little reason we cannot aim higher and approach the kind of installation rates Germany saw at its peak, of over 600 MWp a month.
Appropriate incentives can greatly boost the rate of deployment and will be good value for money, a good example being point 4 in the IEA 10-point plan,25 which recommends a government-funded grant covering 20% of rooftop solar installation cost, which they estimate would double the rate of investment. Such policy interventions are very much necessary because as much as costs have fallen in recent years, the 2021 median installation cost for 0-4 kWp rooftop installations was still around £1429 per kWp (includes costs of panels, electrical connections, and installation).26 A 20% grant would help to alleviate business and homeowners’ concerns that the capital costs of installing solar panels remain high.27 It also has the advantage that it would not pass on additional costs to bill-payers, and would scale with the falling costs of solar (unlike the FIT).
If the UK government were to provide a 20% grant, this would cost £286 per kWp. Assuming around 950 peak sun hours in the UK on average5, 0.95 MWh would be generated for every kWp of capacity over a year, or 4.75 MWh over 20% of a panel’s 25-year lifetime (5 years). This extra energy would save the owners around £898 per kWp over the first 5 years, assuming electricity bills were to remain at around 18.9 p/kWh. This £898 saving from a £286 investment represents excellent value for money, and given the cost benefits, we see no reason that the grant could not cover, say, 40% of the upfront cost, at £572 per kWp, as this would still produce a saving for bill-payers significantly greater than the cost to government, and is likely to increase the installation rate dramatically, above IEA projections. For the greatest social benefit, this grant should apply not only to microgeneration projects of size < 50 kWp, but to 50-250kWp installations also, as these have been greatly beneficial to bodies such as housing associations and local authorities28, who face similar price barriers as individual households. Utility-scale solar has fewer issues with capital cost barriers compared to smaller projects, so its expansion is probably best encouraged by reforming planning legislation to promote solar farms, especially those which are ecologically responsible and/or mixed-use, a fiscally-neutral measure.
This government investment and support would not only benefit the owners of the panels, either. The solar photovoltaic industry supported around 6,200 jobs in 2020 while around 13.1 TWh of energy was produced,29,30 meaning about 473 jobs were supported per annual TWh. In contrast, only about 159 jobs per TWh were supported by the gas distribution and extraction industry in the same year.31 This means that government investment in solar means investment in many more jobs than would, for instance, be provided by the gas industry. Indeed, if an additional 56.3 GWp of solar PV capacity were installed, bringing the UK total to 70 GWp, this may be expected to generate roughly 26,500 jobs, which would be widely distributed around the country, given the technical and economic viability of solar PV across the UK.
Given such clear benefits for bill-payers, business and homeowners, and jobs, there is no need to limit ambition to 70 GWp by 2035. The price of solar power has reached such a point that there are no significant downsides to large-scale investment, especially in the built environment, and any doubts on the rate of return can be put to rest. Indeed, the larger the commitment, the more we stand to benefit from improved economies of scale.
Submitted by: Dr Theodore D C Hobson* on behalf of: Dr Theodore D C Hobson*, Jacob Leaver*, Dr Laurie J Phillips*, Luke Thomas*, Matthew J Smiles, Dr Thomas P Shalvey*, Christopher H Don*, Alexander J Wright*, Leanne A H Jones*, Daniel Bromley*, Dr Joshua Turner†, Dr Amanda J Hughes†, Kieran Routledge*.
*Stephenson Institute for Renewable Energy, University of Liverpool
†Department of Mechanical, Materials and Aerospace Engineering, University of Liverpool
May 2022