C&I, Solar, Wind Power

Plunge in UK Distributed Energy Investment Forecast for 2019

Investment in the UK’s distributed power generation market will witness a significant decline from almost $2.5 billion in 2013 to $939 million by 2019, according to new analysis.

Excessive and overlapping new policies are expected “to create chaos in the UK’s solar PV distributed power generation market in particular,” says a report from research and consulting firm GlobalData.

Investment in wind, solar and combined heat and power installations will fluctuate annually between 2013 and 2015 and then decline from 2016 until the end of the forecast period as a result of various anticipated policy amendments.

These changes include the expiration of the Renewables Obligation policy in March 2017, which will be replaced by Contracts for Difference (CfD) from as early as April 2015. Feed-in Tariffs (FiTs) are also set to expire in March 2021, and are currently subject to degression and corridor limits for each type of distributed power generation technology.

Nonetheless, while reductions in annual investments into the UK’s overall distributed power generation market will negatively impact the number of annual installations, GlobalData still forecasts moderate growth in the country’s cumulative installed distributed power generation capacity from almost 3.7 GW in 2013 to more than 7 GW by 2019.  

“We expect these excessive and overlapping policies to create chaos in the UK’s solar PV distributed power generation market in particular,” says Ankit Mathur, GlobalData’s project manager for Alternative Energy. “As part of its solar PV strategy, the UK government aims to boost the small and medium-sized commercial solar PV distributed generation sector by encouraging rooftop installations on government properties, with a target of installing 1 GW of capacity by 2020. However, only 75 percent of this target is likely to be achieved.”