Solar energy 'could provide 4% of UK electricity in a decade'

Solar power could provide up to 4% of the UK's electricity by the end of the decade, the BBC reports quoting the government as saying.

The plummeting cost of solar panels has caused the government to revise upwards its forecast for solar energy use, Energy Secretary Ed Davey said.

He said this had contributed to the government's decision to reduce solar subsidies from this month.

But the solar industry said the cuts were a mistake and would prevent it from competing with fossil fuels.

The price of solar panels has reduced by 70% in the past few years as subsidies in many countries created a mass market and drew in Chinese manufacturers.

In the UK this prompted the government to withdraw subsidies from large-scale solar farms - above 5MW - from the end of March.

That in turn has created a temporary solar boom as firms race to connect to the grid in the coming days.

The Solar Trades Association said as much new capacity has been installed in the first three months of this year as in the whole of 2014.

But after April it expects installations to fall 80%, because most firms will not be able to compete.

The association's spokesman, Leonie Greene, said: "We need subsidies for another few years - maybe five - before we can compete with fossil fuels in the UK.

"Only 35% of the cost of solar is the price of the panels - the majority cost is the installation and that will only come down if we have a large and thriving competitive industry in the UK.

"The government's decision to pull out subsidies is an own goal - it will delay the moment when solar can compete with fossil fuels."

But Mr Davey said recent tenders for energy contracts among different types of renewable energy companies showed that solar was ready to compete already.

Two of the lowest bids were from solar firms.

Speaking to the BBC, he said he had been "amazed and delighted" by the plummeting costs of solar power.

Mr Davey said: "This is wonderful for humanity.

"There are 300 million Indians without electricity… the effects in sub-Saharan Africa will be dramatic.

"Solar power will do to energy what mobile phones did for communication and markets."

A government spokesman said there were now 650,000 solar installations in the UK.