Environmental benefits and the economics of UK solar energy schemes

The use of solar energy to displace conventional fuels gives rise to benefits from resource saving and also from avoided adverse environmental effects. On the assumption that the displaced fuel is coal-generated electricity, this paper estimates the health benefits from avoided air pollution attributable to using solar panels for domestic water and space heating in the UK. These benefits are compared with those stemming from fuel savings. It is found that the environmental benefits, while non-trivial, are small in relation to the resource-saving benefits. All the benefit estimates considered are crude, and there is a clear need for further work in this area.