Portsmouth announces far-sighted PPA funded solar PV

It was reported in Clean Energy News last week that Portsmouth City Council is to roll out PPA funded solar PV over the next four years under a £10m scheme. This is great news.

This local authority has already performed well in relation to solar PV with nearly 2 MW of roof based solar panels already fitted to date. Of course, these will have benefitted from higher Feed in Tariff rates in the past, dependent on precisely when they were commissioned.

The interesting point, however, is that Portsmouth City Council is proposing to carry on, where many other authorities have called a halt to such work, due to the FIT rates plummeting.

This is far sighted and the sort of longer term thinking that is required to achieve success in the roll out of renewable energy in the public sector.

What the Council has done is to recognise that despite the business cases losing a large chunk of Government subsidy, a good financial return can still be achieved by taking a different route. Most local authorities are large users of electricity and the prices they pay for it average around the 10 pence per kwh mark. So if solar PV can be fitted to those buildings that need the electricity and it can be used on site, the business case still stacks up. Instead of there being a payment of so many pence via a FIT, the Council makes a saving on the electricity bill it would otherwise pay.

Power purchase agreements with commercial tenants of local authority owned buildings, or indeed the Council simply using the electricity in the buildings it occupies itself is the answer.

The same is happening with many local authorities that aspire to a solar farm development. With ROCs and FITs effectively going, most are looking for a private wire opportunity nearby which, again, offers the chance to enter into a private Power Purchase Agreement to sell the power. As rates on these are much higher than the Government subsidy was anyway, they are the perfect answer and will enable schemes to continue being built out. This is what the private sector developers, such as Lightsource are doing, and the public sector should follow suit.

So local authorities across the country should be stepping up their solar plans, not shelving them in the light of FIT or ROC reductions.

Stephen Cirell
Consultant
6 July 2016