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Solar panels installer targets subsidy independence by 2019
The firm planning to install 800,000 solar panels on social homes expects to end its reliance on government subsidies completely within two years.
Solarplicity hopes to fit the panels over the next five years after Dutch investor Maas Capital revealed its intention to invest £160m in the renewable energy provider at the weekend.
It is one of the first major investments in solar panels since a sudden government cut to feed-in tariffs in February 2016 halted many programmes.
By changing its business model, Solarplicity has been able to make the finances stack up without heavy input from Westminster, according to the firm’s managing director Tom Williams.
He said that while Solarplicity previously gave away the electricity generated by its solar panels for free and took its returns from the tariff, it now seeks to raise revenue from selling the energy to residents and landlords over a long-term period.
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“It was always our intention to evolve the business plan to ensure our installations could continue in a low-subsidy environment,” said Mr Williams.
“The government has been very supportive. We’ve been talking to a variety of different departments about our plans.
“They’ve been very keen to see a new model for sale in the UK that is not reliant on subsidies. While we’re not there right now, we’re very, very close. I think we’ll achieve it in about 18 months to two years’ time.”
More than 70 housing associations and local authorities are in discussions with Solarplicity about participating in the scheme, including around 40 who became involved through a framework set up by South West-based housing association Alliance Homes.
The panels will be free to landlords and tenants, with Solarplicity predicting average savings of £240 on bills.
Households will not need to have panels on their homes to benefit from the discount, as Solarplicity will set aside a portion of the energy bills it receives and refund it back to tenants at the end of each year.
Bevan Jones, managing director of consultancy Sustainable Homes, said investment in similar schemes is likely to become increasingly common as backers are attracted by the predictability of solar energy costs.
He said: “Maas Capital is a renewable tech investor and an international company. It looks unusual but they know what they’re doing.”
Solarplicity expects the money from Maas Capital to fund 100,000 installations over the next 18 months and will seek investment for the remainder of the project.
Maas Capital is part of the Netherlands’ third-largest bank, ABN AMRO.
