Wednesday, November 28, 2012

Solar maximum

Recent statistics issued by the Department of Energy (DOE) shows that the price of solar photovoltaic (PV) modules continue to decline at nearly 15% per year. Solar PV, however, still remains uneconomical without subsidies, costing over $6/W for residential systems and over $3/W at utility scale. The report also indicates that the Balance of System (BOS) costs including labor has been declining but they still represent nearly 1/3 of the total costs.

We are inching towards fossil fuel parity – requiring another 100% decline at utility scale and 200% at residential level. In addition to research in materials sciences to fundamentally change module design, one cannot ignore the need to further drive the BOS costs down. Simpler installation, lower losses in transmission & storage and better energy management systems can substantially reduce the costs of installation and maintenance. Reaching fossil parity for solar is a huge game changer – effectively eliminating green house concerns and ushering in the era of distributed generation – that is much more robust providing higher security and efficiency. Such a technology will also lift developing countries, clamoring for cheaper transportation and refrigeration.

It is important to solve this problem holistically. Let’s not ignore the design of the overall system – including wiring, labor, alternators, storage and maintenance in addition to the PV modules.