Thursday, September 27, 2012

Note on U.K. Market

The UK market appears to be undergoing a steady recovery following the August FiT adjustments. The 4 MW per week installation rate is too little for some but the current growth in installation rates is encouraging. If growth rates continue to climb the weekly installs will be up to around 10 MW by the end of the year. I wouldn't be at all surprised by a weekly installation rate closer to 20 MW.

The FiT rates in the U.K. remain sufficiently attractive to drive double digit IRRs - an investment that's hard to beat. With system prices down under 2,000 pounts/kWp (~$3,000 USD/Watt) a 3 to 4 kWp system is price accessible for the middle class. The word will most definitely get out during the family dinners this holiday season. The next FiT cut is set for November 1st but it's a minor cut from 16 to 15.4 p/kWh for systems under 4 kW. This minor FiT cut is unlikely to result in an installation spike. That's a good thing considering the herky jerkiness the UK solar market has experienced in 2012. It rather looks like smooth sailing for the Brits... Famous last words.


No comments:

Post a Comment