The surge in residential solar panel installation over the last few years has meant that British homes accounted for more than a quarter of the country’s solar capacity in 2022. 

According to a study conducted by IT services provider NTT DATA UK&I, domestic solar panel installations made up 27 per cent of the UK’s solar capacity. This is following an unprecedented growth since 2016. 

Energy Live News, which saw the report, revealed residential solar panels comprised 69 per cent of the UK’s added solar capacity last year.

While this shows the growing popularity of renewable energy, it has also put extra pressure on the country’s grid as demand soars.

Eduardo Fernandez, head of gas, power and water at NTT DATA UK&I, said: “Renewed investment in solar installations by homeowners is driving the decentralisation of the energy grid and ramping up the pressure for Distribution System Operators transformation.”

One of the main reasons for the rapid increase in solar panel installations among homeowners is the rising cost of energy. 

Last year, fuel prices soared at an unprecedented rate, which resulted in the government introducing the Energy Price Guarantee (EPG) to cap prices. 

From October 1st 2022 to June 30th 2023, it limited typical fuel costs to £2,500  for an average household in the UK and £2,109 in Northern Ireland per year. 

Without the EPG, bill payers would have faced typical annual bills of as much as £3,280 as this was Ofgem’s Energy Price Cap between April 1st and June 30th. 

Ofgem recently lowered the price cap to £2,074 a year from July for a typical household, which was the result of declining wholesale energy prices, with the savings being passed on to customers. 

As homeowners can get paid to provide electricity back to the grid, they can even earn money from their solar panels. 

However, Mr Fernandez said this is typically at a rate of 4.9p/kWh, which is significantly lower than wholesale prices. 

As a result, they are likely to be tempted to store excess energy in batteries, so they do not have to pay for energy later on and can use their reserves instead. 

While this will help homeowners manage their energy use and costs, he stated it could make “energy supply and demand more rigid and inefficient as electricity must be transmitted over greater distances to meet demand”. 

This comes after the Climate Change Committee (CCC) stated renewable electricity capacity has to increase at a faster rate to meet government targets. 

It noted that solar energy could have helped to “mitigate dependence on imported gas during the fossil fuel crisis”. However, it has not been developed at a fast enough rate, and installation is “significantly off track”. 

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