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Peter Hun

Us Solar Power Nears Competing On Price

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US solar power nears competing on price

By Ed Crooks in New York

Published: June 8 2011 22:35 | Last updated: June 8 2011 22:35

US solar power will compete on price with conventional generation within three years without subsidy thanks to plummeting costs, industry leaders say.

In a breakthrough for renewable generation that will lessen the dependence on fossil fuels, the cost of solar power in California is near that of gas-fired plants at times of peak demand.

Subscription required.

http://www.ft.com/intl/cms/s/05a4354a-91fe-11e0-b8c1-00144feab49a,Authorised=false.html?_i_location=http%3A%2F%2Fwww.ft.com%2Fcms%2Fs%2F0%2F05a4354a-91fe-11e0-b8c1-00144feab49a.html&_i_referer=http%3A%2F%2Fwww.ft.com%2Fhome%2Fuk

module_prices_06.png

http://solarbuzz.com/facts-and-figures/retail-price-environment/module-prices

Europe is cheaper than the US. In some countries , like Italy, solar may already be cheaper than conventional electricity.

modules_table_06.png

Not surprisingly, sales are rocketing

pv-market-size-region.gif

Edited by Peter Hun

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US solar power nears competing on price

Solar could be viable, but the panels need to be about 25% of the current price. I've got solar powered outbuildings, and spent a couple of months going round Europe in a motor home with solar panels so I know the practicalities.

Once they can truly mass produce panels/film, it will change the way we use power; houses may start using a 12v lighting circuit etc.

Edited by tahoma

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Solar could be viable, but the panels need to be about 25% of the current price. I've got solar powered outbuildings, and spent a couple of months going round Europe in a motor home with solar panels so I know the practicalities.

Once they can truly mass produce panels/film, it will change the way we use power; houses may start using a 12v lighting circuit etc.

Those poxy downlights everyone loves already take perfectly good 230 VAC and turn it into 12 VDC!

I wonder, how 'green' is the big lump of iron, copper and plastic that every single one needs...

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US solar power nears competing on price

All very interesting Peter, and progress is always welcome when it comes to energy.

However, I would add a note of caution to this tale.

The problem with all renewables is that the industrial application is limited by the location of the resource and the location of the need.

Eg. Not a lot of wind/sun/tidal power in Birmingham/Sheffield/Swindon, yet that is where a large amount of industry is based. Therefore before this kind of technology can be practical the UK (and other countries) will need a radical overhaul of the transmission and distribution system of our electricity grid. This would take a truly, stagggeringly massive investment, which would take decades to ROI.

I can't see many governments taking multi-generation long view right now, can you?

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Interesting how the price still declines even though the price of silver has gone up by $25 an ounce in the past few years.

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I was going to start a topic on this to make people aware that may not be already

If you install solar in our country now the government will PAY YOU 40p per unit for every unit you produce .......even though you are using the units youself(you can sell the units you don't use for 3p a unit also)

This money is guarenteed for 25 years and rises with inflation (maybe not true inflation but the inflation they state)

Now bearing in mind it costs around 11-12p per unit at the moment plus the 40p you get paid it makes it a fantastic investment (pay back by end of year 6 and a circa 15% return on investment per year)

This, is obviously only any use to someone who owns their own property with the intent of at least staying in it for 5 years plus

As far as I'm aware , it doesn't need to be fixed to your roof and could be on your shed , in your garden etc (yes I believe people have abused this somewhat renting farmers fields and filling them with panels so it may well be capped)

Hope this info is useful to someone or at least brings awareness to people , personally , I want a 3-4kw system on my property which I estimate will cost around 20k but will return around 3k a year income as well as 'free' electric worth around 800 quid a year

The panels work at optimum with a south facing roof/area ,

Note to add I don't work for anyone associated with this scheme , ie solar firms / government etc nor do I know anyone who does - dunno why I write this , just feeling paranoid I guess Haha too many years smoking the green

Edited by scottw

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To be slightly critical nuclear power 24/7 generation of electricity. Solar power at best will give around 12/7 generation. In periods where it's dark what fills the hole?

Wind? If it's not windy then what?

Tidal might be an option.

Although solar at current prices is impossible expensive for most home owners, unless of course they MEW. However perhaps we could kill two birds with one stone with this?

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After Germany also Switzerland yesterday decided to get out of nuclear power (parliament voted on it) and Italy has a referendum on it this coming weekend.

This will further support research and development of alternative power sources and inevitably lead to solar becoming even cheaper.

If France the US and the UK don't follow they will lose out with regards to the jobs and know-how that the alternative power industry will create in Germany, Switzerland and Italy.

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To be slightly critical nuclear power 24/7 generation of electricity. Solar power at best will give around 12/7 generation. In periods where it's dark what fills the hole?

Hydroelectric power is 24/7 (or even better it's actually on demand) and can even be used to store power.

Although solar at current prices is impossible expensive for most home owners, unless of course they MEW. However perhaps we could kill two birds with one stone with this?

MEW'ing for a solar power installation would actually be a sensible use of MEW'ing, far better than a new flashy car or an expensive holiday...

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My own house runs completely off solar, in that we're not even connected to the main grid.

The biggest cost of a diy solar project is the cost of the batteries.

Basically your whole house is powered by a large battery bank and the solar panels simply act as battery chargers. Solar panels themselves are pretty cheap at the moment with prices as low as two or three pounds per watt, for a typical 100 watt panel.

You could put together a big enough array to provide a 240v supply to your house and do without the batteries but then what do you do at night? You have to have some way of storing all that generated power and currently the only way is to use batteries.

A decent deep-cycle 100Ah battery will cost you several hundred pounds and could last for up to ten years. But you need lots of them to store enough power so that you can live a "normal" life and use everyday 240v appliances such as washing machine, iron, tv, etc.

The actual solar panel element of an off-grid setup is secondary to your battery bank.

In fact you could manage with just a few hundred watts of solar panels and instead get an economical petrol or diesel generator. A good quality power inverter will take your generator supply and act as a big battery charger putting up to 100A of charge into your battery bank. Obviously you need a big enough battery bank to be able to handle a 100A charger - putting that kind of charge into a typical car battery would result in an interesting mess. The point is, running a generator for a couple of hours can put a huge amount of power back into your battery bank far far cheaper than the ROI from the equivalent quantity of solar panels.

However, if you are connected to the grid and have a feed-in system which pays you for every watt of power you provide to the grid then it's worth it because you can forget the battery element.

A generator probably uses about a litre of fuel every hour/hour and a half. Could you hook up this to your feed-in system? Can't be bothered to work out the figures but it might even be profitable.

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Hydroelectric power is 24/7 (or even better it's actually on demand) and can even be used to store power.

MEW'ing for a solar power installation would actually be a sensible use of MEW'ing, far better than a new flashy car or an expensive holiday...

Are there enough locations in the UK suitable for Hyroelectric?

I agree that MEWing for solar would perhaps be a good investment, although I'd want more efficient panels than you presently buy. Although I'm not certain I have the roof space.

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All very interesting Peter, and progress is always welcome when it comes to energy.

However, I would add a note of caution to this tale.

The problem with all renewables is that the industrial application is limited by the location of the resource and the location of the need.

I can't see many governments taking multi-generation long view right now, can you?

Well it just means Saudis and Africa have us by the balls regarding energy monopolies, they have lots of worthless land and lots of sun. The emptyquarter in Saudi for instance. Which they can use to electrolyse water to turn to Hydrogen which can be converted to a form of petrol usable in cars recently developed. At which is can be shipped via super tankers to Europe.

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My own house runs completely off solar, in that we're not even connected to the main grid.

The biggest cost of a diy solar project is the cost of the batteries.

Basically your whole house is powered by a large battery bank and the solar panels simply act as battery chargers. Solar panels themselves are pretty cheap at the moment with prices as low as two or three pounds per watt, for a typical 100 watt panel.

You could put together a big enough array to provide a 240v supply to your house and do without the batteries but then what do you do at night?

As said what about electrolysing water and burning the Hydrogen that comes off it? Using it to turn a turbine of some kind. Hell if you had the space maybe you could even attach it to a water pump or to heat salts to a molten mass and extract the heat at night.

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This is an interesting project in Belgium:

http://www.guardian.co.uk/environment/2011/jun/06/tunnel-solar-belgium-rail

A two-mile-long Belgian rail tunnel, built to shelter trains from falling trees, will from Monday provide a double environmental benefit by hosting a unique solar power project.

The high-speed line running from Paris to Amsterdam passes Antwerp and a nearby ancient forest. To avoid the need to fell protected trees, a long tunnel was built over the line which has now been topped with 16,000 solar panels. The electricity produced is equivalent to that needed to power all the trains in Belgium for one day per year, and will also help power Antwerp station.

"For train operators, it is the perfect way to cut their carbon footprints because you can use spaces that have no other economic value and the projects can be delivered within a year because they don't attract the protests that wind power does," said Bart Van Renterghem, UK head of Belgian renewable energy company Enfinity, which installed the panels.

"We had a couple of projects lined up around London with train operators and water utilities, but they have been put on hold."

Van Renterghem said this was due to the UK government's controversial review of subsidies for large-scale solar power projects, which will lower the returns available.

So if two miles are enough for 1/365th of the power need for belgian railways, that means covering 730 miles would be sufficient to completely run the belgian railways on solar power.

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US solar power nears competing on price

(...)

Great news. Thanks for the post.

About the FT subscription, I heard you can access individual articles directly via Google?

http://www.google.co.uk/search?hl=&q=US+solar+power+nears+competing+on+price&sourceid=navclient-ff&rlz=1B3GGLL_en___GB407&ie=UTF-8

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Well it just means Saudis and Africa have us by the balls regarding energy monopolies,

Spain and southern Italy have plenty of unused land too and enough sunshine to make solar and solar-thermal very viable as an export industry.

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Spain and southern Italy have plenty of unused land too and enough sunshine to make solar and solar-thermal very viable as an export industry.

Sure but a lot of the land is arable and thus not as worthless as sandy/rocky desert you get in Saudi, not to mention the Saudis are highly motivated to make the switch. Seeing as their oil is running out (why else would they want to be building 30 reactors by 2025?).

While Spain/EU will just turn on the printing presses for a bit.

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(...)

Once they can truly mass produce panels/film, it will change the way we use power; houses may start using a 12v lighting circuit etc.

Besides, the "usage" side is improving too, like the new LED lights consume only a fraction of older incandescent bulbs, and other appliances should improve as well.

If or when we develop new and cheaper energy sources, the world will enter a new phase of global development. Energy is key.

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@OP

You need to be very careful when looking at the solar lobby, they're a tricky lot (I should know, I used to work for them).

They tend to quote price per Watt Peak and compare that with other technologies. Of course peak output is irrelevant, what we want is Watts Average across a year. This figure is much lower (IIRC about 10% in Europe) than the Watt Peak value. They also play a lot of tricks with depreciation and maintenance to make the Discount Cash Flow look more attractive. Finally they bury their heads in the sand about storage costs:- you need tremendous amounts of storage to turn Watts Peak into Watts Average, and storage ain't cheap.

And your graph from SolarBuzz is accompanied by the following text " ...As a result, production has got out ahead of demand leading to falling prices and building module inventories.". So the price drops are just a correction due to supply/demand imbalances, no fundamental change to the economics.

My old boss (solar lobbyist) got a letter in the Grauniad saying how Germany had "replaced" 4 nukes with solar power. Of course that's a lie. The nukes are still there - they have to switch back to them when the sun ain't shining. Which is most of the time.

Basically semiconductor solar panels are made out of fossil fuels. The energy input to make them is enormous. So the price of solar panels roughly tracks fossil fuel prices. Unless there is a breakthrough in efficiency (no sign of it yet) or a move to plastics panels (plausible, but decades away) solar will always be the ugly duckling.

And finally, the quote "the cost of solar power in California is near that of gas-fired plants at times of peak demand" [presumably peak air-con time, noon]. Who cares? It's like saying, "my Bugatti has nearly the same cost per mile as my Polo, when both are rolling down a steep hill". I'm interested in the average cost of solar power over the year, because that's how you get your return on investment. Even in CA the sun only shines about 20% of the time, so it sounds like solar is on average about 5x the cost of gas. Just like it's always been.

I was in solar 20 years ago, it was 5x the price of fossil fuel back then. Fast forward 20 years, what a surprise, it's 5x the price of fossil fuel.

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To be slightly critical nuclear power 24/7 generation of electricity. Solar power at best will give around 12/7 generation. In periods where it's dark what fills the hole?

It's worse than that, for countries like the UK there is a strong seasonal cycle. In the months of November, December and January, you will be lucky to get 6 hours generation, and the sun is so low in the sky you'll be getting nothing like peak power.

Wind? If it's not windy then what?

That is the 'renewable nightmare' - a period like last December. Very little usable sun, very light winds and very cold temperatures for a couple of weeks. There is no way that any realistic storage technology could handle that.

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This is an interesting project in Belgium:

http://www.guardian.co.uk/environment/2011/jun/06/tunnel-solar-belgium-rail

So if two miles are enough for 1/365th of the power need for belgian railways, that means covering 730 miles would be sufficient to completely run the belgian railways on solar power.

Wow that is sad , solar still totally useless for any industrial application....

Coal is still king.

Maybe another 20 years research will vastly improve the technology , no point putting in too much solar panels now when in 10-20 years they will be 500+% more efficient?

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Hydroelectric power is 24/7 (or even better it's actually on demand) and can even be used to store power.

(...)

Yep, hydroelectric power is "on tap" 24/7 :P (sorry)

No seriously, it can fill up the gap of other alternative sources, like when there is no wind, during the night.

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After Germany also Switzerland yesterday decided to get out of nuclear power (parliament voted on it) and Italy has a referendum on it this coming weekend.

This will further support research and development of alternative power sources and inevitably lead to solar becoming even cheaper.

If France the US and the UK don't follow they will lose out with regards to the jobs and know-how that the alternative power industry will create in Germany, Switzerland and Italy.

Alliteratively, Germany et al are going down an engineering dead end, which will mean more expensive electricity, greater fossil fuel consumption and hence larger GHG emissions. German per-capita CO2 emissions are already significantly greater than the UK, let along France. If they replace nuclear power with coal and some renewables.. it's going to get worse.

If you want to compare solar and nuclear - as an example - I want to see the total cost of a solar system - including backup - for which the stated output can be turned on and off at will and is available at least 90% of the time.

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Hope this info is useful to someone or at least brings awareness to people , personally , I want a 3-4kw system on my property which I estimate will cost around 20k but will return around 3k a year income as well as 'free' electric worth around 800 quid a year

The panels work at optimum with a south facing roof/area ,

Note to add I don't work for anyone associated with this scheme , ie solar firms / government etc nor do I know anyone who does - dunno why I write this , just feeling paranoid I guess Haha too many years smoking the green

I run a renewable energy company so do have a vested interest in solar power and the Feed In Tariff scheme which was introduced last year.

Some of your figures are not quite right.

The current FIT is 43.3p for every kWh produced with an addition 3.1p for exported energy. Most energy suppliers (who fund the scheme through a levy on all electricity consumers) assume a customer will use 50% of the energy they produce and export 50%. So this gives a price of 44.85p per kWh produce.

A Typical 4kWp (the tariff drops after this level) south facing system in South Devon, where we operate, will generate 4000kWh/year (we have to quote using an industry standard called SAP2005 which is based on Sheffield Climatic data and would indicate our customers would only generate 3300kWh/year).

A typical breakdown is

£1800 FIT payment

£200 saved on electricity bill

Installation cost £14k

Your figures of £20k installation costs are excessive, if you seek a local installer you will get a 4kWp system with quality components fully installed for the price given above.

With a total yearly benefit of £2000 it gives a return on investment of 15%. This is TAX free and RPI linked for 25 years!

The tariff for new entrants is scheduled for regression with it reducing each year. Although I am in the industry the current tariff and the current installation costs make it the best time to consider installing solar power.

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