SUN’S PROMISE

Solar PV's Tremendous Promise; Renewable energy has achieved surprising growth in the past five years, and looks set to continue that progress in the coming years
25 May 2011 (World of Photovoltaics)

"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…Worldwide, a total of 37 GW of solar were installed by the end of 2010, with 17 GW in Germany alone…[T]his installed solar capacity is capable of producing a full 25% of that country's peak electricity consumption (70 GWpeak) on a sunny afternoon…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.

"…[B]eyond 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…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…"

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"In China, the government…may double [its PV target]…over the next five years…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…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…"

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"…[Challenges] 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…"