Advances in solar power are happening so quickly that they could herald the end of the era of large coal-fired or nuclear power stations in Britain, according to senior executives at National Grid.

“From a consumer’s point of view, the solar on the rooftop is going to be the baseload,” Steve Holliday, the transmission network’s chief executive, said. “Centralised power stations will be increasingly used to provide peak demand.”

His finance chief went even further. Andrew Bonfield said that solar panel costs were falling so rapidly that energy from the Sun was expected to be one of the most cost-effective ways to power homes within 18 months. With home storage of electricity and using battery technology fast advancing in the United States, he said that the prospect of pulling the plug on a power company and going “off grid” could become a reality within five years.

Mr Holliday, who is scheduled to leave National Grid next year after 15 years with the business, said that energy markets were “clearly moving towards much more distributed production and towards microgrids” — a big break from the past, when big power stations delivered centralised power to consumers and businesses on demand.

“This industry is going through a tremendous transformation,” he said. “We used to have a pretty good idea of what future needs would be. We would build assets that would last decades and that would be sure to cover those needs. That world has ended. Our strategy is now centred on agility and flexibility, based on our inability to predict or prescribe what our customers are going to want.”

National Grid, the operator of Britain’s gas and electricity transmission and distribution network, is overseeing an overhaul of the country’s energy network to accommodate sources of renewable electricity, including domestic solar electricity production and onshore and offshore wind. It predicts that by 2020 small-scale distributed generation will represent a third of total capacity in Britain.

Mr Holliday made his remarks in an interview with World Energy Focus, a publication of the World Energy Council, an alliance of 90 nations that collaborate on energy policy matters. “The amount of solar being added to the system is incredible,” he said. “[There was] 1,500 megawatts in the first three months of this year. That’s the capacity of two power stations. I made a comment to the energy minister four years ago that there was little probability we would have 20,000MW of solar in the UK. Now three of our scenarios have more than 20,000MW of solar by 2035.”

Britain has slashed the subsidies available for solar energy. Last month, ministers said that the 90 per cent cut in the “feed-in tariff” for generating power from new rooftop solar panels was necessary to prevent rising green energy payments from hitting consumer bills. The cut from 12.9p per kilowatt hour to 1.63p is set to come into force in January for all new solar projects.

However, Mr Bonfield said: “The UK installed more than 4GW of solar power in just one quarter this year. Look around the countryside, you see these huge solar farms. The subsidy being cut will reduce growth, but prices are dropping. Grid parity is the average cost of generation on the network and solar could be there in 18 to 24 months if the drop in panel costs continues.”


Article originally published 'The Times - 28/9/15' by Robin Pagnamenta and Ben Jackson