Energy Handbook 2011 - GBR

P o w e r S u m m i t - T h e E n e r g y H a n d b o o k 2 0 1 1
F o c u s : S o l a r P o w e r
Solar Power
Of all our current energy technologies, solar power boasts perhaps
the greatest mass appeal. Existing solar panels have excellent green
credentials thanks to their proven effectiveness and comparative
lack of visual intrusion, and all forms of solar technology are
developing fast. The world’s roofs seem ripe for solar energy.
Article by:
Tom Willatt
Above:
TÛRANOR
PlanetSolar, the
world’s largest
solar-powered boat
travels around the
world to advocate
for green energy;
Photo courtesy of
cleantechnica.com
The untapped resource is
unquestionable. According to the
International Energy Agency, the
amount of energy absorbed by the planet in
one hour is more than the world consumes
in an entire year. Despite this enormous
potential, however, solar technology is
currently an expensive choice. Under the
best-case scenario in sunny locations, the
cost of solar-powered electricity is about
$0.17/kWh, compared with about $0.15/
kWh for offshore wind, $0.07/kWh for
coal and nuclear, and $0.06/kWh for gas.
Overview
Solar generation falls into three main
technologies. Two of these – photovoltaic
(PV) solar cells based respectively on
silicon wafers and polymer films –
produce electricity directly and are ideal
for distributed generation.
The third technology, concentrated
solar thermal power, uses sunlight as an
energy source but is otherwise more akin
to conventional thermal generation.
“Solar will not replace all other generation
– a generation mix is vital,” believes
Jason Gray, Vice President & Country
Manager, Canada at SunEdison, a pioneer
in solar systems. “Getting that right
balance is what regulators now need to
struggle with. We continue to see the
price of solar come down. We challenge
regulators to appreciate the full benefits
of solar in terms of generating right at the
load,” Gray continues.
One of solar energy’s great advantages
is that it often allows for electricity to be
produced cleanly at the point of use. This
distributed generation reduces losses
and negates the need for expensive and
unpopular transmission investment.
“Due to the ageing transmission and
distribution infrastructure, the question
is whether to go for big centralised
generation or create generation close to
where the load is being consumed. Also,
the power that solar can produce matches
the peak. Instead of having idle baseload
capacity solar is at its maximum output
during those peaks,” Jason Gray notes.
Another benefit of solar, in a world
of diminishing fossil fuel reserves
and unstable prices, is the absolute
consistency and security of supply. “The
biggest benefit to investors of solar
projects, that people often overlook, is
that fuel cost for your generator is zero
and absolutely without volatility. Your
power purchase agreement is 15–20
years long and even beyond that you
have a long, perhaps infinite, continuity
to that solar project,” says Lewis Reford,
CEO of Schneider Power, a Canadian firm
developing renewable energy projects
across North America. Such predictability
is valuable to investors.
Subsidy Catalysts
The solar industry is still in its infancy
relative to other energy generation,
so although it only contributes around
0.5 percent to global installed generating
capacity, its phenomenal growth means
that this share is rising rapidly. According
to the European Photovoltaic Industries
Association, global installed solar power
capacity grew by 6.4 GW in 2009 to
To date, the solar-cell boom has been
a mostly European phenomenon driven
by generous feed-in tariffs in Spain and
Germany, with the rationale that costs
will decline as volumes increase and
manufacturers gain experience. Solar
power now produces up to a tenth of
Germany’s electricity on sunny days.
Without such policies, the high cost of
generating solar power would prevent
it from competing with electricity from
traditional fossil-fuel sources in most
regions.
However, across Europe, subsidies are
now being scaled back and most of the
growth in demand will be elsewhere.
China is expected to become a big user, as
well as maker and exporter, of solar cells.
America is likely to build lots of large-scale
solar plants. Unsurprisingly, however, the
greatest opportunities lie in the nations
that combine the most sunshine with high
prices for conventional power.
Reaching Parity
The holy grail of renewable energy is
to reach grid parity, the point at which
alternative energies can compete in
price with conventional grid power.
Once solar achieves this, many experts
believe that its adoption will increase
exponentially. “We’re getting there,”
says Jon Kieran, Director of Solar at
EDF EN, the renewable energy spinoff of
French utility giant EDF.
“The price of inputs is going down and the
knowledge of installation, efficiency of
panels and new technologies is improving.
This has meant that the price of solar has
come down dramatically over the past
two years. If we continue this rate we’re
going to be competitive with peak grid
energy in parts of North America within
the next two to four years. That would
have been unheard of four years ago.”
“We now have an obligation in the solar
industry to lower the cost of solar and
make it a more compelling proposition for
customers, stakeholders, governments,
power systems and utilities,” Kieran
continues. “We cannot simply scoop
these incentives. In the process of
investing in these plants, and enjoying a
However, the price of solar is falling and Silicon PV is by far the commonest
policy-makers around the world are taking technology, today accounting for
the solar option far more seriously. This 90 percent of installed solar capacity.
section explores the rate of solar adoption Production has been increasing by an
around the world, the options currently average of 48 percent each year since
available, and the newest developments 2002, making it the world’s fastestgrowing
78
in solar technology.
energy technology.
22 GW, an increase of 41 percent. commercial return from these production
79