UK solar sector loses 50% of jobs due to subsidy cuts

The UK solar power industry has lost over half of its 35,000 jobs as a result of government cuts to subsidies. The losses occurred just as solar surpassed coal as a generator of electricity in the country. Solar Cloth Company went into administration earlier this month, as did Solarlec a fortnight ago. Last year, almost 1,000 redundancies were caused when the Mark Group suffered the same fate. Michael Grubb, professor of international energy and climate change policy at University College London, commented that it was not yet clear whether the sector would disappear or simply start to grow more slowly.

The solar power industry says it has seen the loss of more than half its 35,000 jobs due to recent changes in government energy policy, just at a time when solar power has eclipsed coal as a major generator of Britain’s electricity.

Experts believe ministers had cut subsidies too far and too fast, praising the “seismic”, record-breaking growth of solar in recent years.

This month the Solar Cloth Company became the latest to be put into administration, following the liquidation and 170 job losses at Solarlec two weeks ago.

The biggest single collapse was late last year when the Mark Group went into administration with almost 1,000 redundancies.

The Solar Trade Association (STA), which represents the industry, said it was collecting exact statistics to be published soon but experts believe up to 18,000 jobs have gone in less than 12 months.

Jonathan Selwyn, chairman of the STA, said companies had been “very hard hit” and many were trying to change their business models or concentrate on overseas markets.

He contrasted ministers’ enthusiasm for slashing subsidies for solar with their professed concern for other struggling industrial sectors such as steelmaking. “This [solar] must be the only industrial sector where the government is congratulating itself for causing thousands of job losses,” he said.

But the government said it had a duty to balance jobs with household bills. “Our priority is to keep energy bills as low as possible for families and businesses whilst supporting low-carbon technologies that represent value for money,” said a spokesman for the Department of Energy and Climate Change.

“The cost of solar has steadily declined over the last 10 years and it is right that as this comes down so should the consumer-funded support,” he added.

Michael Grubb, professor of international energy and climate change policy at University College London, said it was too soon to say whether the solar sector would settle into slower growth or drop away completely.

“Solar has benefited from extraordinarily generous subsidies and no one – including me – expected to see such incredible growth rates. It has been quite seismic for a country that was getting a smidgen of power from renewables only a few years ago. But the cutbacks [in subsidies] have been dramatic and quick.”

The new importance of solar has been underlined by recent research by analysts at Carbon Brief showing solar panels produced more electricity than coal in May.



Deployment of renewable energy is moving even faster on the continent, with Portugal running its entire electricity network for four days in May entirely on solar, wind and hydropower.

The increasing use of these technologies across the world was one of the reasons the oil group BP, in its annual statistical review published on Wednesday, reported global CO2 emissions showed no growth in 2015 for the first time in 10 years.

Crews install panels that form the world’s largest floating solar power array in the Queen Elizabeth II reservoir near Heathrow. Photograph: Martin Godwin/Martin Godwin for the Guardian

Britain has in recent years installed up to 10 gigawatts of solar power – enough to power more than 3m homes, or 65% of the power promised from the planned new reactors at the Hinkley Point C nuclear plant.

Photovoltaic panels on household roofs and in larger industrial arrays produced 1,336 gigawatt hours (GWh) last month compared with 893 GWh from coal, which is being burned less and less as old plants such as Ferrybridge in Yorkshire and Longannet in Scotland are retired.

Amber Rudd, the energy and climate change secretary, has promised to close all coal-fired power stations by 2025 as part of a plan to reduce carbon emissions and tackle global warming.

Scottish Power, the owner of Longannet, once owned half a dozen coal-fired power stations but is now dependent on gas and wind farms for generating electricity. It has six new onshore windfarms under construction.

Wind has been at the forefront of the low-carbon revolution in Britain, but the government has also removed all subsidies from onshore turbines saying developers no longer need financial incentives.

There is already 8.8GW of wind power onshore and another 5.1GW offshore, according to the lobby group Renewables UK. Ministers are committed to helping windfarms out at sea which have received much less opposition from residents but are much more expensive to develop.

Growing investor enthusiasm for low-carbon energy in the aftermath of commitments made at the Paris climate change talks were underlined this week with the £10bn flotation of Dong Energy.

The Danish company has already spent £6bn on UK wind farms such as the London Array project and plans to inject a further £6bn by 2020 on projects such as Hornsea 1 off the coast of Yorkshire.

Turbines forming part of the London Array windfarm project in the Thames estuary. Photograph: Bloomberg via Getty Images

Dong is an energy company that is in transition from an oil and gas producer to leading wind power developer. The larger pure oil companies such as Total of France, Shell and Statoil have also started to invest recently in low-carbon activities.

They are under pressure from some of their own shareholders but are also aware that tougher regulations on carbon emissions must be on their way if governments are to tackle global warming and meet their climate change commitments.

Total has just spent $1bn (£700m) buying a battery storage business, Saft, that could play a key role in beating the problem of intermittency in electricity generated by solar and wind power.

Shell has just established a new energies division, though it admits the scale of investment will be small at first, while Norway’s Statoil has just been granted a seabed lease that will allow it to build the world’s largest floating windfarm, Hywind, off the coast of Scotland.

Critics question whether the newfound interest in renewables by traditional oil companies is genuine or just an attempt to take the heat off themselves as they come under increasing fire from environmentalists who accuse them of stoking climate change.