By Paul Homewood
As the Telegraph reported, Gridserve, who are launching the new EV forecourt, have recently acquired the UK’s first subsidy-free solar farm – the Clayhill Solar Farm in Bedfordshire – to guarantee that all of the energy used at the Braintree Electric Forecourt® comes from net zero-carbon solar power:
![image_thumb[1]](https://notalotofpeopleknowthat.files.wordpress.com/2020/12/image_thumb1.png "image_thumb[1]")
But there is a back story to Clayhill which needs to be told.
First we need to note that new solar installations have levelled off since subsidies were withdrawn in 2017. In the last two years, only 444MW has been added, just 3% of the total. Almost of this has been small scale stuff, below 50KW.
https://www.gov.uk/government/statistics/solar-photovoltaics-deployment
Clearly solar farms are not viable without subsidy. Clayhill, which began operations in 2017, was of course billed as “subsidy free”. But their Annual Accounts reveal that they are actually losing half a million a year:
https://find-and-update.company-information.service.gov.uk/company/08662024/filing-history
Annual output is around 7.1 GWh, equating to an average price of £112/MWh. (According to REF, loading is 8.2%). However, it appears that a large chunk of their income is derived from the energy storage side. My guess is that electricity sales generate less than half of the turnover:
Clayhill’s holding company Anesco confirm that this storage revenue is largely thanks to continued growth of renewable energy.:
https://find-and-update.company-information.service.gov.uk/company/07443091/filing-history
And of course it is consumers who have to pay the bill for balancing at the end of the day.
Anesco themselves signed an agreement with EDF in March 2019, which helps to explain why Clayhill’s turnover doubled year-on-year:
https://anesco.co.uk/edf-energy/
Despite this boost from EDF, Anesco were still desperate to offload generating assets, and concentrate on operating and servicing the assets instead:
It appears likely that Gridserve picked up the Clayhill Solar Farm on the cheap. It also enables them to have the benefit of a fixed price for power going forward.
Naturally Clayhill cannot supply power directly to Braintree, so the power will be supplied to Gridserve via what is called a Sleeved Power Purchase Agreement (PPA). Urban Grid describe how this works:
https://www.urbangridsolar.com/what-is-a-sleeved-ppa/
Crucially sleeving allows the user to still buy power when the solar farm is not available:
Although the sleeving arrangement ensures the buyer pays the usual network charges, the utility company may offer cut price fees, as it is acting as a facilitator, merely taking power from Clayhill on a PPA and passing it on to Braintree. Effectively cutting out the middleman.
Such an arrangement makes sense for both parties.
In addition, Clayhill/Gridserve are able to sell the REGOs, the Renewable Energy Guarantees Origin. So-called green energy suppliers often don’t buy in renewable energy, but instead buy bits of paper (REGOs) from renewable generators.
The bottom line to all of this is that solar power may make sense such as this, where Gridserve both own the asset and “buy” its electricity, effectively cutting out the middle man, while at the same time still being able to source all the power it needs from the grid 24/7, whether the solar farm is generating or not.
But all the evidence suggests that the Clayhills of this world cannot make money when left to fend for themselves in the open market, without subsidies and guaranteed sales.
via NOT A LOT OF PEOPLE KNOW THAT
December 1, 2020 at 03:36PM
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