17/03/2016
Recent changes to the subsidies available for photovoltaic energy in the UK have been widely reported 1,2, but what effect are these changes having on UK R&D in the photovoltaics sector?
To incentivise UK homes and businesses to invest in new photovoltaic installations, a scheme of “feed-in” tariffs was set up in 2010. These tariffs, which also exist for other types of renewable energy, are paid to compensate for the very high capital costs involved in setting up new photovoltaic facilities. A generation tariff is provided to give a fixed payment per kilowatt-hour of energy generated, while an export tariff provides a further payment in return for selling excess energy to the grid.
Since 2010 the Department of Energy & Climate Change (DECC) has been recording data relating to the total amount of UK generating capacity from solar photovoltaics (which also includes those facilities not signed up to the tariff scheme). The figure below shows, in orange, the amount of new UK photovoltaic generating capacity added per year according to DECC figures 3.
These data show a substantial increase in the UK’s new capacity, particularly over the last two years. However, following the introduction of the feed-in tariffs in 2010, the DECC has implemented changes which dramatically reduce the favourable treatment given to UK solar energy. On 1 August 2012 the duration for which generation tariffs are paid was decreased from 25 years to 20 years 4. More significantly, on 15 January 2016, the generation tariff was reduced to 4.39 pence per kilowatt-hour, which represented a 63.5% decrease in generation tariffs for a typical 10 kW installation 5.
It is interesting therefore to consider how the patent landscape is reacting to these changes. The data shown in blue in the graph indicate the number of UK or European patent applications and granted patents published in the photovoltaics field6. Although the patent data, which can be taken as an indicator of the R&D activity in the field, show a sizeable increase up to 2013, the number of publications has clearly started to tail off after this time. As patent applications are published 18 months after filing, it is possible that we will continue to see such a trend in future as the most recent subsidy changes kick in.
With reduced tariffs and an apparent slowing down of patenting in this sector, the time is certainly ripe for the development of new technology to provide cheaper and more efficient photovoltaics in the UK. We look forward to seeing which future directions this technology will take.
This article is for general information only. Its content is not a statement of the law on any subject and does not constitute advice. Please contact Reddie & Grose LLP for advice before taking any action in reliance on it.
