Solar Energy: A Global Overview
By Guy Dauncey
July, 2002
Available Energy
There is no shortage of solar energy.
Every day, the sun radiates 3,000 times more energy onto the
Earth’s surface than we use (96,000 versus 321 terawatt hours).
The delay in realizing the solar revolution is the cost. In
the mid-1970s, photovoltaic modules cost $70/watt. Today, because
of improvements in efficiency and the benefits of larger-scale
production, they cost $3.50/watt. To compete with conventional
electricity, they need to sell for $1/watt (7 cents/kWh). When
this happens, there will be an explosion in the production
and use of solar energy around the world. Solar energy is clean,
produces no CO2 emissions, and once installed, the energy is
free.
Solar Technologies
- The leader in the solar technology
race is the solar cell made from wafers of crystalline silicon,
which rates an efficiency of around 15% (35% in the laboratory),
and commands 90% of the global market.
- Coming up behind (with 10% of
the market) is the solar cell made from amorphous silicon,
which can be spread into a thin film, a hundred times thinner
than silicon crystals. This requires much less of the expensive
silicon, and can be produced in a roll, making mass production
easier. The cells have an efficiency of 6% (17% in the laboratory),
and can be coated directly onto glass and roofing tiles.
The multi-junction thin film modules (copper-indium-gallium-selenium)
have achieved a 34% efficiency in the laboratory.
- A future runner is a solar cell
made from tiny silicon beads bonded in aluminium foil, which
can also be made into roofing tiles, and promises to be half
the price of the crystalline cells. Production is starting
in Canada in 2003.
- Still in the laboratory are cells
made from tiny nanorods of cadmium selenide (a semiconducting
material) dispersed in an organic, electrically conductive
plastic or polymer. This is an experimental technology, but
once mature, the cells could be manufactured in a beaker
and turned into photovoltaic ink or paint. (2% – 4.5% efficiency
in the laboratory).
- There are three other types of
solar technology: solar hot water heaters; solar thermal
parabolic troughs which heat water, connected to steam turbines;
and solar thermal towers. In Australia, a consortium of Australian
and German companies is planning to build a 1 kilometre high
tower at Mildura (Victoria State), surrounded by 30 square
kilometres of glass or transparent plastic. Hot air from
the glass will rise up the tower and drive 32 turbines, producing
200 MW of power, enough for 200,000 homes.
Market Progress
Driven by government policies, falling
prices, concerns about climate change, and consumer demand,
global solar production is expanding by 35 - 40% a year. (1999 – 201
MW; 2000 – 288 MW; 2001 – 391 MW). Japan is the unquestioned
leader, with strong government policies and support, and a
national target of 5,000 MW by 2010. Switzerland has the highest
amount of solar per capita, followed by Japan, Australia, Norway,
Germany and Holland. Globally, solar represents less than 0.1%
of the world’s primary energy supply, but once the price becomes
competitive, the potential will be enormous.
|
MW Total 2001 |
MW installed
2000 |
Average hours
of sunshine/year |
Domestic price
of electricity cents/kWh US |
Installed PV,
watts per capita |
% of world
solar production |
Japan |
301 |
100 |
1200-1600 |
24 cents |
2.4 |
45% |
Switzerland |
15
(2000) |
2
(1999) |
1700 |
12 cents |
2.14 |
? |
Germany |
170 |
77 |
1700 - 1800 |
15 cents |
2.0 |
6% |
Australia |
29
(2000) |
4
(1999) |
2500 - 3000 |
4 cents |
1.5 |
? |
USA |
139 (2000) |
21.5
(1999) |
2000-2500
(California) |
8 cents |
0.5 |
27% |
Canada |
7
(2000) |
1
(1999) |
1500 - 2500 |
4 cents |
0.22 |
0 |
UK |
2
(2000) |
1
|
1500 - 1700 |
12 cents |
0.03 |
0.75% |
The Solar Players
The five main players are Sharp,
Kyocera, BP Solar, Shell Solar, and Astropower. Sharp has just
built the world’s largest multi-crystal silicon plant in Japan,
aiming produce 200 MW of solar cells by the end of 2002 (20%
of the world’s demand). According to a 1998 study by KPMG,
commissioned by Greenpeace, a factory that is able to produce
500 MW a year will be able to reduce the price to $1/watt because
of efficiencies of scale, opening up a potential market of
160 million households (320,000 MW, or 320 GW, if each household
bought a 2 kW system). For thin-film solar cells, the per-factory
volume needs to hit 100 MW a year to compete with conventional
energy. United Solar (USA) has just opened the world’s largest
thin-film amorphous PV plant in Rochester Hills, Minnesota,
which is able to roll out 30 MW of solar film a year.
Solar Finances
The price of solar energy is determined
by the cost of the solar modules and the accompanying equipment
(a 50:50 split), the interest paid on the capital, and the
amount of sunshine received, calculated over an assumed life
of 20 years. A typical 2 kW rooftop system costs $16,000 ($8/watt).
In a hot sunny climate averaging 5.5 hours of sunshine a day,
with a 5% interest rate, the price of solar is around 30 cents/kWh.
If electricity costs 20 cents/kWh, the payback period is 30
years. If electricity costs 10 cents/kWh, the payback is 60
years. The perfect combination is a high price of electricity
(eg Japan) and a low price for solar (by developing a mass
market). When solar falls to $1/watt and electricity costs
20 cents/kWh, the payback will fall to 7 years.
Jobs and Economic Development
According to a study by the US-based
Renewable Energy Policy Project, the installation of solar
PV systems can create seven times more jobs that windfarms – 35.5
person-years per MW. For every million dollars invested in
solar electricity, between 5 and 15 jobs are created, compared
to 1.5 jobs in oil and gas exploration. In 2000, the City of
Chicago, ComEd, the local power utility, BP Solar and the state
of Illinois struck a deal with Spire Solar Chicago, a PV manufacturing
facility, whereby the City and ComEd would buy $8 million worth
of solar systems for installation over 3 years, and Spire Solar
Chicago would establish a PV production and assembly business
in Chicago to produce 3 MW of solar panels a year, generating
10 million kWh of electricity and displacing 12,500 tons of
CO2 per year.
Government Policies
In Japan, the government has established
a strong research program and a "70,000 solar roofs" incentive
program. Their intention is to build a self-supporting market
with mass production by 2005, flood the global market with
cheap solar product, and force other competitors out. With
Sharp’s new 200 MW factory, they appear to be on target for
solar modules that sell for $2 or $1/watt by 2005. The US solar
industry has produced a solar roadmap which seeks to reduce
the cost of modules to $3/watt by 2010, and $1.50 by 2020 (too
late for the Japanese solar assault). The most effective policies
include (a) production incentives, such as Germany’s guarantee
of 48 cents/kWh to solar producers, falling by 5% per year;
(b) net metering, which ensures that a customer can sell surplus
solar energy on hot summer afternoons back to the grid for
a fair price; (c) "renewables portfolio standards",
by which governments require utilities to produce a set amount
of energy from renewables (eg Arizona’s 1% from solar by 2002),
(d) rebates and buy-downs, such as Japan’s 70,000 Roofs program,
and Los Angeles $5/watt rebate (financed by a "Public
Benefit Charge" on all utility bills); (e) subsidized
loans, and (f) tax credits and incentives. In San Francisco,
following a successful public campaign and referendum, the
city borrowed $100 million in solar bonds to finance the installation
of 12 MW of solar on public buildings, which will pay for itself
out of the saved cost of not installing a new power plant,
costing taxpayers nothing. A May 2001 Gallup poll found that
91% of Americans supported investments in new sources of energy
such as solar, wind and fuel cells, while only 6% were opposed.
Solar in the UK
Solar activity is still small in
the UK, averaging 1 MW a year. In May 2001, a government programme
of solar grants was announced covering up to 50% of the installed
cost of a domestic solar system, 65% of a public installation
and 40% of a commercial solar system, with £20 million available
until 2005. The government hopes to see solar panels on 100,000
homes, and has also launched a Large Scale Building Trial of
photovoltaic systems, with £3m to finance 12-15 building-integrated
solar installations larger than 20 kW on public and private
buildings.
Solar in Developing Nations
Around the world, 400 million households
people live without electricity, obtaining their evening light
from kerosene lanterns or batteries. Where microcredit schemes
exist, the cost of purchasing a small 50 watt solar panel is
the same as kerosene, and the US-based Solar Electric Light
Fund works in many countries to encourage their installation.
India is the third largest producer of solar cells after Japan
and the US, and had installed 500,000 small solar systems (58
MW) by 2000.
The Future
In 2001, the world’s total solar
production represented around 0.04% of global power generation.
The critical price breakthrough that will trigger the worldwide
solar revolution is only 3-5 years away, however, if Japan’s
success continues. Progress could be accelerated if the world’s
nations agreed to form a global solar compact, speeding up
the growth in demand in order to hasten the fall in price.
The implications of solar energy selling at a competitive price
within a very few years will be very profound, and ought to
be considered by every government and economic development
agency.
Some Useful Organizations:
Written by Guy Dauncey, Victoria,
B.C., Canada, author of "Stormy Weather: 101 Solutions
to Global Climate Change" (New Society Publishers, July
2001, distributed in the UK by Jon Carpenter Books, Oxford). www.earthfuture.com
