UK set to lose solar investment after developer criticises lack of incentives

The UK is set to lose a high-profile solar power investment after developer Oxford PV said it was the “least attractive” market in which to locate its new factory and that it was more likely to list in New York or Hong Kong.

The photovoltaics company, which was spun out from Oxford university in 2010 and is based in the city, announced a record in efficiency for commercially available solar cells on Wednesday.

But Chris Case, its chief technology officer, told the Financial Times that between continental Europe, the US and the UK, the latter was the “least attractive” location for the factory to manufacture the cells because of a lack of incentives.

“It seems to me the rest of the world is staking their future on solar and the UK is not,” he said, adding that “Germany and the US are strong candidates” for the production site.

The criticism was made as the Climate Change Committee, the UK government’s statutory advisers, warned in a report published on Wednesday that the UK risked missing out on new green industries by failing to develop the necessary workforce skills.

Oxford PV declined to give details of its finances. Its latest accounts show that in 2021 it recorded a pre-tax loss of £21.5mn and raised £50mn via a third-party loan. The new solar cell will be the first product it has sold commercially.

Case said it intended to engage in a new round of funding of hundreds of millions of pounds to manufacture its proprietary technology and is considering a stock market listing. But he said: “To us and to me personally the most attractive markets for listing are things like the Nasdaq and markets in Hong Kong but not so much the UK.”

The government has come under mounting pressure from former ministers and industry to develop an industrial strategy that will help the UK compete amid a global race to attract technologies crucial to the green transition.

Both the US and EU have announced broad-ranging proposals to boost renewable energy and battery technology in an effort to catch up with China, whose huge subsidies have made it dominant in most clean energy supply chains.

Oxford PV’s current test factory is based near Berlin, a decision Case said was taken because the UK offered “zero from an incentives standpoint”, while the German government had offered subsidies that accounted for about 20 per cent of the capital required.

“It was quite disappointing to have a technology born and bred in the UK yet commercialised elsewhere,” Case said.

The CCC, meanwhile, highlighted the intense competition for green investment from Europe and the US, adding that Britain would lose market share unless it supported “skills that attract investment into the UK”.

The UK must “defend its competitive advantage” in areas such as hydrogen and carbon capture, it added.

The CCC said up to 725,000 net jobs could be created in areas such as electric vehicles and renewable energy generation but it warned that such growth “is not guaranteed” and would require “active reskilling” and government support.

The business department did not respond to requests for comment.

The technology developed by Oxford PV, which has been independently verified by German research institute Fraunhofer ISE, sets an efficiency record of 28.6 per cent conversion of sunlight into energy, a roughly 5 percentage point improvement on typical silicon cells. It has been made possible thanks to developments in using perovskite, a mineral derived from calcium titanate.

A 33.2 per cent record for the most efficient perovskite-silicon cell was achieved by scientists in April, but only for a laboratory model.

Oxford PV said that solar panels using its cells should be on sale early next year.

The company is part-owned by the Swiss solar developer Meyer Burger and Chinese renewables company Goldwind. Case said that neither had access to Oxford PV’s technology.