A new report has quantified the cost of integrating solar into the UK power market, both today and in a 2030 scenario where solar provides over 10% of annual UK electricity.
The report, by Aurora Energy Research, was launched at the Solar Trade Association’s (STA) Smart Power event at the Conservative party conference and shows that today the cost of integrating solar into the power system, including ‘back-up’, is negligible at only £1.30 per MWh, or less than 2% of the costs of solar today.
It states that more than tripling solar generation to 40GW (over 10% of annual UK electricity) would increase the costs of managing variability modestly, to a maximum of £6 – £7 per MWh.
The STA says this clarity on the costs of integrating large volumes of solar, together with further expected cost reductions in solar installations, supports its and other analysts’ expectation that solar can be the lowest cost form of energy generation in the 2020s.
Paul Barwell, chief executive of the STA, said: “The tremendous growth in local, clean generation has challenged the old power supply model, yet Ministers can be reassured that the rapid expansion in solar power over recent years has been absorbed efficiently and affordably by the system.”
The modelling shows that integrating solar into a more decentralised, flexible, ‘smarter’ power system, including batteries, actually delivers more benefits than costs to the system.
The report also highlights and evaluates the portfolio effort of combining solar and wind in the energy system. The modelled scenario follows the ‘High Renewables’ pathway set out by the Committee on Climate Change as a generation mix consistent with the UK’s 2030 carbon budgets.
This requires 40GW of solar and 45GW of wind, enough to power 55% of the UK’s electricity system in 2030. The cost impact of solar on the system falls by 25% in this scenario, due to the complementary generation profiles of solar and wind.
Welcoming the report, Angus MacNeil MP, chair of the Common’s Energy and Climate Change Committee, said: “This welcome research puts numbers and maths behind the variability of solar power. It gives a concrete understanding of what solar has to offer compared to other technologies. Combined with reducing capital costs solar is going to be as cheap a source of power as you’ll find anywhere.”
