The Scottish Government has boosted solar investor confidence north of the border by announcing that, contrary to what the Department of Energy and Climate Change has proposed for England and Wales, it will retain the ‘grandfathering’ guarantee for investment in solar.
Scottish Energy Minister Fergus Ewing cited the need for “clarity and certainty” for solar projects to attract funding and reach financial close.
This is in the context of the UK Government’s proposal to close the Renewables Obligation completely for large commercial solar rooftops and solar farms as of April of next year, which applies across the country and which is a decision for the UK Government.
The Scottish Government has also announced it will not be reviewing the level of Renewables Obligation support for solar prior to the early closure of the scheme, as is being proposed in England and Wales in what is called a ‘banding review’. Again, this will help remove uncertainty and boost investor confidence for projects in Scotland.
Decisions on grandfathering policy and Renewables Obligation banding reviews in relation to projects in Scotland are a matter for Scottish Ministers. In the letter published today, Fergus Ewing expressed “disappointment” in the failure of the UK Government to consult the Scottish Government on its proposals.
John Forster, Chairman of Solar Trade Association Scotland (STA Scotland), commented: “This shows that the Scottish Government is fully committed to solar providing as much as possible of its 100% renewables target for Scotland.”
“Solar projects in Scotland now know what level of support they are going to get, and that they will get it for the full 20 years. It won’t be possible to cut support for Scottish projects down the line in, for example, year 15 of 20.”
“We particularly appreciate how Minister Ewing has moved as quickly as possible in making this decision, allowing solar businesses to plan ahead and focus their efforts on any Scottish projects in the pipeline.”
‘Grandfathering’ is the guarantee that the level of support provided per unit of electricity will not change throughout the lifetime of a solar installation once it has been built and connected, and once the investment has been made. The Solar Trade Association is calling for the Department of Energy and Climate Change to re-consider its proposal to remove this guarantee in England and Wales, which would be a serious blow to investor confidence.