Solar PV's Tremendous Promise

Popular Articles

Renewable energy has achieved surprising growth in the past five years, and looks set to continue that progress in the coming years.

“I’d put my money on the sun and solar energy. What a source of power! I hope we don’t have to wait until oil and coal run out before we tackle that.” – Thomas Edison in conversation with Henry Ford, 1931

( renewable energy /green newswire) – Renewable energy has achieved surprising growth in the past five years, and looks set to continue that progress in the coming years. Of the various renewable energy sources, the solar photovoltaic industry has enjoyed the strongest growth recently, averaging 50% annual installation increases for 5 years running. In light of recent events, and following announcements by several countries in reaction to these events, it’s time to provide a quick update on the solar pv industry. We will shortly introduce two new companies operating in this sector.

Worldwide, a total of 37 GW of solar were installed by the end of 2010, with 17 GW in Germany alone. As pointed out on Tuesday, this installed solar capacity is capable of producing a full 25% of that country’s peak electricity consumption (70 GWpeak) on a sunny afternoon (if you’d like to see for yourself, visit the link provided at the end of this article). While the rate of growth will likely slow in 2011, current estimates are calling for another 22 GW of solar to be installed worldwide this year.

Looking beyond 2011, it is likely that recent events in Japan will spur countries to increase their investments in the solar industry. In Germany, the government is now working out the details of raising its 2020 renewables target to 40% of total electricity consumption (from an earlier target of 35%). Solar PV will play a large role in that, and Germany will probably raise its annual installation cap from 3.5 GW to 5 GW. In email conversations with a former colleague of mine who works in the German electricity industry, he noted that his bosses were now spending several days a week in Berlin in planning discussions with the federal government. In-house, they are now working on a new renewable energy investment plan for the coming decade, where before there was none.

From Japan, we heard the following from their Chief Cabinet Secretary, Yukio Edano: “When considering the damage from this accident, there is no doubt we are moving toward making renewable energy sources a pillar.” Japan was an early adopter of solar PV in the late 1990s, only to drop the ball in 2006. It restarted its solar PV support program in 2009, and now has 3.5 GW installed country-wide. It currently has a target of 28 GW total by 2020, but this number is likely to be revised upward based on the above quote.

In China, the government stated that it “may double its target for photovoltaic power capacity over the next five years in the wake of Japan’s nuclear crisis.” This would mean a total of 10 GW by 2015, rather than the previous target of 5 GW. Although China is now home to over 50% of the world’s solar PV manufacturing, 99% of that production is exported to other countries. China is just getting started with its own installations, with 400 MW being installed in 2010. Getting to 10 GW by 2015 will require a very aggressive program. One important point to keep in mind: in 2006, China stated that it would install 5 GW of wind by 2010 and 30 GW by 2020. It managed rather more than that: 42 GW were installed by the end of 2010!

The past decade’s rapid rise in solar PV installations has brought with it a rapid decrease in costs. The levelized cost of electricity (LCOE) from solar PV has dropped by 75% this past decade. Following the 2008 financialelectricity price in California is now 15 cents US per kWh. More importantly, the supply of electricity from solar PV comes on at the time of highest demand, in the afternoons. This is when the price of electricity peaks, up to 25 cents US per kWh and higher. Solar PV is thus able to shave this peak demand, reducing the high power demand on the network at midday, and produce electricity at a price below the spot market price. crisis, and a reduction in demand, costs dropped 50% over the next two years. We’re now at the point that a new industrial scale installation (500 kW) in southern California is able to produce solar PV at 16 cents US per kWh (see below for the source). The average retail

All this good news is not meant to ignore the challenges that remain. Barriers to installation must be eliminated in most countries, from outdated regulations to unnecessary paperwork. A US-based solar PV installer recently estimated that installation costs in the US residential market could be reduced by 50 cents per watt (or roughly 15-20% of the total cost) by instituting a standard permitting process. Overall costs must continue to be reduced, and manufacturers continue to work towards broader grid parity. It is likely that we will see costs drop another 10% overall in 2011 alone.

Solar PV holds tremendous promise, both near-term and looking further out. It remains probably the most versatile renewable energy source available to us, being able to scale from a 5 kW home installation, up to a 300 MW utility scale installation in the California desert. Both the U.S. and China look to be leading countries in the next five years of this growth, and we look forward to profiting from this continued expansion.


- Advertisement -

More articles

Latest articles

- Advertisement -