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Just another day in the Commons - where we merrily destroy the PV sector with spin

Posted by Howard Johns on 29 November 2011 at 9:31 am

Anyone working in the solar industry will have been appalled,  dismayed and almost certainly angered to watch the debate on their future and the feed in tariff that took place in the House of Commons. I was sat in the viewing gallery watching and despite the best efforts of Caroline Flint and many backbenchers, solar PV was given the shock treatment by Ministers in an attempt to justify their mishandling of this situation. At one stage Chris Huhne likened the industry to a Catherine wheel spinning so fast and then suddenly going out, saying that these cuts were necessary to avoid that situation. The spin is that these cuts are in fact creating this situation, and the only thing that was spinning madly in the house last night was the Right Hon Gentlemen Barker and Huhne themselves, with a few of their poorly briefed colleagues.

So let’s debunk a few bits of the spin – of which there were many:

“We find ourselves here to debate a motion that would add at least £26 to an average consumer bill—that is, if we were to leave the scheme unchanged. The estimates are constantly being revised, and the figure may well reach as high as £80 on the current trajectory.” Said Chris Huhne in his address. Firstly no one is suggesting that the tariffs are left unchecked and unchanged. The £26 number and now the inflated £80 number are based  according to the impact assessment on: ”A “Do Nothing” scenario, representing business as usual (i.e. no solar PV review) where current tariffs for new installations are degresssed at 9% p.a. as originally intended”. No one is suggesting we do nothing. To use the £26 cost to bills that this would cause if this was left to happen is divisive and misleading – let alone the pumped up Daily Mail headline number of £80.

Caroline Lucas made an excellent interjection saying “Does he accept that six months ago the solar industry itself asked for them to be reduced by 25%? The reason for the chaos we are experiencing is the incompetence of this Government.” To which Chris Huhne replied “I absolutely do not accept that. Not a single solar installer to whom I have spoken does not say that tariffs must fall, and on that point I entirely agree, but that was not the case before.” Well Minister if you do not read or reply to correspondence it is little wonder you have no idea what is going on in the solar industry. The STA has requested a number of meetings with Chris Huhne – we have not had one. Our “strategy for a solar revolution” was released back in May – and specifically said that Government should cut the tariffs by 25% - I know because I got lots of flack for putting it out. Mr Huhne was not listening.

It seems that headlines was what Messers Huhne and Barker were most focused on – spin headlines that cause worry to the uninformed listener to justify their destruction of this vibrant sector. Pitching themselves as the saviours of consumer bills is a fabulous bit of positioning – at the expense of the PV industry – and if you were not livid at this situation already you have every justification to be so now.

If Ministers cared about the development of the sector rather than just bashing the Shadow PM, and political point scoring at our expense – surely they would have modelled another scenario – somewhere in between “Do Nothing” and complete destruction. But now they have shown that they are capable of dealing with “bumper profits to solar companies” according to Huhne – what bumper profits are those? For anyone building a business investment costs are high and in reality businesses in the sector were unlikely to make much above 5% net profits – and that was before all this madness. It is just really sad that they are completely impotent when dealing with the profits of the six large companies that dominate our energy supply. Instead they take a stand with 3000 SMEs – many of whom were established in the last year, who have increased employment figures dramatically – and literally built an industry out of nothing. Criminal.

Tariffs “are now in line with those being offered in Germany” says Huhne. Really? More spin - The German feed-in tariffs (FiT) vary according to installation capacity and whether modules are roof- or ground-mounted. There is a unique FiT for ground-mounted installations, independent of size, set at €0.2111/kWh. The FiT for a roof-mounted up to 30kW installation is currently set at €0.2873; from 30 to 100kW at €0.2733; from 100kW to 1MW at €0.2586; and above 1MW at €0.2156. So no they are not – the German rates are higher across the board – and they are in a market with 15 years experience, 150,000 employees and massive deployment rates. But above all they have a stable feed in tariff regime – not one which manages to have four devastating reviews in one year. As for PV getting the highest tariffs in the UK – that is simply not true either – Ministers need to read details of their own FIT scheme, with support for other technologies that is higher than that proposed for PV. More spin and more misinformation.

“To wait any longer would put at risk the entire feed-in tariff scheme. Anything that slows this process will substantially increase the risk that the scheme will run out of money.” Messers Barker and Huhne were the ones that created the budget cap. They and their officials were the ones that submitted a set of figures to Treasury for this process that were not seen by anyone in the industry, and now this has become the thing to which we are all beholden. This really is the height of madness – a perfect storm of the Ministers own creation. How are we meant to plan businesses and in fact an entire new area of our economy with this sort of treatment.

There were so many divisive and misleading points in the narrative yesterday it was pretty hard to listen. The assertion by Huhne that the PV sector will “do little to tackle climate change” is both shocking and downright wrong – this guy has plainly never seen this stuff in action and considered the upstream effects of decentralized energy – let alone the consumer effects. More spin.

“There should be a sensible, structured reduction in the subsidy—not a jump off the landing, but a walk down the stairs” says Tom Greatrex – that’s all we are asking for – but instead we are being put up against the wall by the playground bullies – and firmly shoved.  For me the worst bit of all was sitting in the viewing gallery watching the front bench team smiling merrily and chuckling to themselves as other members of both sides of the house talked of the devastating impact that this proposal is having on jobs, companies, communities and individuals in their constituencies – the arrogance and apparent disrespect was unbelievable.

If you were at our mass lobby or have contacted your MP – take heart we have had an impact here – we shall see when analysis of the voting is done shortly, but many members of the house had heard your concerns and were doing their best to voice them.

The fight for PV in the UK has just gone up a gear. It is obvious that we are not being heard by our Ministers, that their bold statements about sustainability for the industry are just a fig leaf for a knee capping. So if you were not angry and ready to act  - you must be now. There are going to be plenty of opportunities in the coming weeks to make our voices heard, and I encourage all who believe solar should have a future in the UK to get involved. We must keep the pressure firmly on and turn up the volume on our campaign – that way we might have a chance for our hard of hearing Ministers to hear our reasoned arguments.

Sign up to www.oursolarfuture.org.uk for updates. Full debate transcript can be found by clicking here

Photo by Nic R

About the author: Howard Johns is the founder and MD of Southern Solar Ltd and a director of the Solar Trade Association.

If you have a question about anything in the above blog, please ask it in the comments section below.

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