Sunday thoughts: Can a nationwide programme of solar installation take the heat out of schools’ energy crisis?
As schools await the start of term with trepidation about the energy bills that are about to land on their doorsteps, could the dilapidated school estate provide a solution in its chaos?
It seems clear that the incoming Truss government will provide a substantial package of support to households for energy price rises. I’m reasonably confident, though not entirely, that this will be matched (in its existence, if not in its scale) with a package of support for businesses, and for public services like schools.
Obviously in the short term the priority is simply to keep schools open and not running deficit budgets, which means paying inflated bills. But in the medium term, there’s an opportunity to save some money, support energy security, as well as make progress on Net Zero. And that’s through a full, nationwide programme of green rebuilding for schools — starting with mass solarification.
The one silver lining of energy prices rising is that the price mechanism itself is a wonderful thing for changing behaviour. It means that the comparator cost for all manner of energy efficiency schemes suddenly now looks more viable. What is known as the payback period — the time after which the upfront investment is covered by savings on running costs — is falling for solar, domestically and for businesses. What has historically been a pretty niche concern (just over 5% of all public schools in the US currently have solar power, and data admittedly from 2014 in England shows just under 3% did — even its doubled since then, it’s still small) could be about to come mainstream.
The barrier still remains the need for upfront investment. And if schools are burning (ahem) through their reserves, that means that it either needs to come from government or private borrowing. Given the latter may require a change in the law, and immediate repayments, it seems a simpler option in the short term is for a proportion of the forthcoming schools energy grant scheme to be used for mass green solar installation, among other things.
To try and think what this looks like, I’ve run some basic numbers. It very quickly became clear to me in doing this that I’m not an energy person, and I’m hugely grateful to my Public First energy colleagues Daisy Powell-Chandler and Nick Park for their initial steer. The three of us also plan to write more on this when we have the time to run some proper numbers. So take the below with a pinch of salt.
I’ve tried to do some broad brush estimates in two ways — top down nationally, and using the example of Ormiston Academies Trust as a bottom up example.
Nationally, what’s known as the total GIFA (Gross Indoor Floor Area) for English schools is 78million m2. If we assume the average school building is two storeys tall, that gives us 39million m2 of roof space. Let’s assume that only a quarter of that is really viable for solar (because the rest is old and in poor condition, or doesn’t have space on it, or is in the shade, or is north facing, or for any other reason). That gives us 10million m2 of roof space, which fits about 5m solar panels. At a cost of roughly £500 per panel, that’s a cost to the government of £2.5bn. Very roughly, we calculate that this level of solar installation could save around £80m — £160m a year based on an average panel power generation and (crucially) using 2021 prices for electricity — giving us a payback period of between 15 and 30 years. But if electricity prices double for schools, this brings the payback down to 7–15 years.
Secondly, I looked at Ormiston Academies Trust. I want to stress right now that it’s not because they’re badly run or energy inefficient, but simply and usefully that they have been public about their energy bill costs pre and post spike, and because we know a lot about their school numbers, building sizes, and pupil numbers, we can run test numbers on it.
The fascinatingly helpful solar for schools database estimates that for one randomly selected Ormiston secondary school, full solar installation would cost c. £157,000, and could save as much as 25% of their electricity bill. On the database’s calculations — again, based before the energy price rise — it projects savings of around £10,000-£12,000 a year, with a payback after 12 years.
But again, as prices go up, these paybacks speed up. For example, on Ormiston CEO Nick Hudson’s data quoted in the article above, Ormiston are on track to spend around £430 per pupil this academic year on energy. Assuming that’s roughly evenly split between gas and electricity, a saving of a quarter of the electricity part of that bill would save £50 per pupil. That makes a payback period in the selected school above, with around 1,300 pupils, as little as 3 years. Even if bills will not be going up as much as Ormiston predict , or the saving is much less than the database estimates, payback could easily be covered in 5–7 years.
In other words, in something between 5–15 years, we could have covered the cost of greening something like 25% of school electricity generation, as well as offset some of the price rises on a permanent basis, and provided greater resilience and energy security for a major public service.
Those payback estimates are aggressive. For one thing, they don’t account for the cost of capital upfront if schools buy solar panels themselves, nor the cost of maintenance. For another, it is likely that not all schools will see savings as much as a quarter — some schools on the solar for schools database are projected to only save in the 8%-10% region. And even in a best case scenario, it saves 12% or so of total school energy bills. But on the other hand, gas and electricity prices can and probably will rise even higher than schools are facing now, so savings become greater. The point is that as prices for non renewable energy rises, payback periods for cheaper energy speed up — and the quicker an upfront investment is made, the quicker the benefits are recouped.
Alongside this mass solar installation, so that that money put in doesn’t literally flow out the broken doors and windows, I am (Bernie Sanders voice) once again calling for some action to be taken on priority school refurbishment. The total capital backlog for the school estate dwarfs the money we’re talking about for green refurbishment — estimated at £11.4bn. But an additional say £2bn to £3bn, focusing on the worst condition estate as regards insulation, would need to come alongside it.
We know major energy companies are expecting a surge in domestic demand for solar panels, and are worried about skills shortages to fit them (maybe they can repurpose all the heat pump engineers who were trained in 2019–2021’s green skills shortage crisis, only to find no households were yet installing them). Alongside this domestic growth, a government backed and funded green proofing scheme, to roll out solar panels onto the vast majority of schools over a 5 year period or so alongside insulating the worst condition buildings, would be a tangible thing that could be done; could be funded relatively cheaply by diverting a percentage of a presumed forthcoming school energy grant; would support wider jobs for a new army of installation engineers as well as in the manufacturing of panels; and would have year on year benefits in terms of cost savings and energy security — not to mention the wider carbon benefits and Net Zero contributions.
