In periods of heightened economic and geopolitical volatility, decision-makers face an all-too familiar challenge: too much noise, not enough clarity. Competing solutions, shifting policy signals, and uncertain market dynamics make it difficult to distinguish between hype and opportunity.
This is precisely where rigorous economic analysis and a clear-sighted view of the policy landscape become essential.
For Bluefield, one of the UK’s largest owners and operators of utility scale solar, the question was not whether floating solar had potential, but whether it could scale, compete, and deliver real economic value in the UK. This required an independent, evidence-based assessment that was substantiated by data, policy intelligence, and market realities.
Commissioned to assess the economic and strategic role of floating solar photovoltaics (FPV), CBI Economics delivered a robust, evidence-led analysis to support engagement with the Department for Energy Security and Net Zero and demonstrate FPV’s full potential within the UK’s energy mix.
We found:
- Floating solar is a viable, near-term solution: with a large, untapped pool of UK water bodies close to demand and grid
- Deployment depends on policy support: capacity could scale up to ~59GW by 2050 and find cost competitiveness with ground-mounted solar by the 2030s under the right framework
- Significant economic opportunity: £30bn+ GVA and thousands of jobs, contingent on early UK supply chain investment.
A credible solution that can have an immediate impact
A central objective of the work was to demonstrate that FPV can become a credible component of the UK’s future energy system. Through detailed spatial and market analysis, a substantial untapped resource base was identified – thousands of hectares of man-made water bodies located close to demand centres and existing grid infrastructure.
Drawing on international evidence from markets already deploying FPV at pace, the analysis positioned floating solar as a complementary solution that can ease land-use constraints, strengthen energy resilience, and integrate with existing infrastructure assets.
Providing clarity through scenario modelling
While the UK Government has set ambitious clean power targets, the real challenge lies in delivery. To address this, CBI Economics developed a policy-driven modelling framework to assess how FPV deployment could evolve under different policy environments and, critically, what interventions were required to unlock it.
Under a supportive policy framework, including a ring-fenced Contracts for Difference (CfD) pot, planning reform, and designated grid access, FPV could scale to nearly 59GW by 2050 and become cost-competitive by the end of the decade.
We consider three scenarios. In the limited case, there is no targeted support, no planning reform, and projects remain at the back of the grid queue. The central scenario introduces a ring-fenced CfD pot, planning reform to enable up to 10% coverage by 2035 (rising to 30% by 2050), improved grid access, and modest gains from offshore wind co-location and innovation funding. The ambitious scenario strengthens these measures, with a larger CfD pot, faster planning rollout (15% coverage by 2035), full grid prioritisation, and greater co-location benefits.
On the path to scale, floating solar could produce:
- 3.6GW by 2030: enough to power a city the size of Birmingham
- 18.3GW by 2040: equivalent to the output of around 11 large UK gas power stations
- 40GW+ by 2050: comparable to the UK’s entire current offshore wind fleet.
Without intervention, deployment would remain marginal and FPV a relatively expensive technology solution. This ability to isolate cause and effect, to show not just what could happen, but how and why, is central to the value CBI Economics brings.
Quantifying the economic opportunity
Building on these deployment pathways, CBI Economics quantified the wider economic impact. Using HM Treasury-aligned input-output modelling, the analysis found that FPV could generate over £30 billion in cumulative Gross Value Added by 2050 (approximately similar to the size of the UK’s mining and quarrying sector in 2023) under a high-deployment scenario, while supporting tens of thousands of jobs across UK supply chains.
During this project, we engaged directly with supply chain firms to identify the key policy signals that would drive investment in the capabilities needed to serve the FPV market.
This also highlighted a critical risk: without an early and strong deployment signal, much of the value chain would be captured internationally rather than within the UK.
Turning insight into influence
In a rapidly changing policy environment, evidence, clarity and a deep understanding of how markets, policy and economics interact are paramount.
CBI Economics combines analytical rigour and policy fluency to equip clients like Bluefield with the evidence they need to engage credibly with government and to help shape the conditions needed for investment at scale.
If you are looking to strengthen the evidence base behind your strategy or influence the policy environment in which you operate, our team would be pleased to discuss how we can help.
About CBI Economics
CBI Economics is the economic consultancy arm of the Confederation of British Industry, providing independent economic analysis, business insight and policy evaluation to clients across the UK and internationally. We combine deep analytical capability with direct access to businesses across sectors and regions, enabling us to deliver robust surveys, impact assessments, cost-benefit analysis and strategic advisory grounded in real-world evidence. Our clients include government departments, universities, regulators, industry bodies and leading private firms.
To discuss how we can support your organisation, please get in touch.
