Warehousing industry calls on DESNZ for support in unlocking potential for rooftop solar

February 1, 2024

The UK Warehousing Association and Syzygy, the UK’s leading advisor and developer of renewable energy projects within the commercial real estate sector, joined forces on Monday to bring together high profile leaders from all sectors of the UK warehousing industry – including occupiers, landlords and developers – to meet with Andrew Bowie MP,  Parliamentary Under-Secretary for State at the Department of Energy Security & Net Zero (DESNZ) and Co-Chair of the UK Solar Taskforce.

The meeting, which took place at One Great George Street in London, was a round table discussion aimed at highlighting to the Minister the industry’s frustrations around unlocking the huge potential offered by rooftop solar power.

Despite their different perspectives,  delegates were united in their commitment to comply with the government’s decarbonisation objectives, but cited limitations of the National Grid, delays caused by Distribution Network Operators (DNOs), and shareholder complexity, as significant barriers to adopting roof-top solar power.

Minister Bowie heard that the industry has the will, ambition and money to adopt solar power on warehouse rooftops, but that various processes require simplification. One delegate observed that there is no  differentiation from a commercial point of view between drawing power from rooftop solar panels and buying offsite power, so that many companies opt for the cheaper, less complicated option of buying power on a ‘green’ tariff, rather than installing it themselves. Planning consent was raised another of the biggest challenges, although DESNZ policy officials  highlighted that recent changes in permitted development rights have removed the 1MW threshold for non-domestic rooftop solar.

Achieving operational energy efficiences was seen as an easier option compared to adopting renewable energy. Complexity and inconsistency across stakeholder interactions was highlighted as a key reason for this, particularly around liability for solar panels in leasing agreements. One ESG expert stressed the need for simplicity and suggested that industry agree a uniform contract arrangement for solar.

A real estate developer noted that his company was investing in energy banks in countries other than the UK, due to the market complexities and the commercial challenges of selling excess power at such low rates, while Germany, France and the Netherlands were cited as having a better approach to supporting businesses in investing in renewable energy sources.

Responding, Minister Bowie said that he was aware of the issues around the grid and DNOs, and referred to the myriad recent and ongoing worstreams by government, regulator, and industry, to address them (Connections Action Plan, NIck Winser’s report, ESO Connections REform, ENA Industry Action Plan). He noted that he was ready to listen to industry experts around the table to understand how the government should move forward. He pledged that the government would go further and faster to overcome the barriers through recommendations in the upcoming UK Solar Roadmap.

He commented, “Clearly there are significant challenges to meet our net zero target, and we can only achieve it if we maximise rooftop solar. There’s a lot to take away, but it is overwhelmingly positive that everyone here wants to do the right thing and adopt cleaner energy. This has been an incredibly insightful and useful couple of hours. We have covered a lot of ground and I have learned a lot. I will be taking forward the recommendations of this group to government. ”

UKWA CEO Clare Bottle said, “The government has set a target for the UK solar energy sector to  increase solar PV capacity from 15 GWp to at least 70GWp by 2035. Our sector has the capability to deliver a significant part of this target, but is currently underexploited, with just 5% of warehouse buildings with solar panels on their rooftops – that simply isn’t good enough! The Minister has asked us for a clear set of action points required to unravel the complex challenges we face in driving forward with installing rooftop solar, particularly on warehouses. Industry leaders have highlighted the need to break down communication barriers and have called for more joined up thinking at government level. There is no shortage of motivation within the industry, but a better regulatory framework is needed along with a clear policy to push it over the line.”

Concluding, John Macdonald Brown, CEO of Syzygy, said, “This was such a great opportunity to communicate first-hand to the Minister industry experiences and concerns around the challenges faced by the commercial real estate sector to deliver rooftop solar at scale. We are very grateful to him for his open approach and close attention to the views of those representing the industry. The bottom line is that projects can and are being delivered, collaboration between owners and occupiers of buildings is happening – but it is complex and really needs to be simplified. This means focusing, both from a real estate and government perspective, on removing the friction from the permitting process, in particular availability of grid capacity, which is a growing challenge.  The fantastic thing about rooftop solar is that the environmental and economic benefits are both clear and powerful. Businesses can reduce operating costs and well as directly reducing carbon emissions. It’s time roof-top power was prioritized, it simply isn’t getting the attention it needs from government, and our hope is that this meeting with Minister Bowie will contribute to making real change.”

Ends.

Attending companies and organisations (in addition to DESNZ):

Amazon, CRBE, DHL, DP World, GXO, Howard Tenens, John Lewis Partnership, Logistics Energy Forum, London Metric, Osborne Clark, Panattoni, Prologis, Rhenus Warehousing Solutions, Robuck Asset Management, Royal Mail, Segro, St Modwen.