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Solar Power on Verge of Sunbelt Boom

Sunbelt countries around the equator are ripe for a boom in solar power generation that could finally put electricity in the homes of 1.5 billion people and keep factories humming anywhere in the world, a new study says. The European Photovoltaic Industry Association (EPIA), the world’s largest, says China and India will lead the way as PV prices fall and economies rapidly develop in countries located ±35° around the equator.

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Print November 22, 2010, 13:22 (CET)
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Solar Power on Verge of Sunbelt Boom

The 53-page report, titled ‘’Unlocking the Sunbelt Potential of Photovoltaics”, says PV can compete today with diesel generators, will be competitive with gas and oil by 2020 and with coal by 2030.

The study comes at a critical time as nations debate how much to invest in renewable energy and whether to build new coal-powered and nuclear plants. The billions, even trillions, about to be spent on energy generation worldwide could be more sustainably spent on solar panels.

Thus the EPIA’s bold push in a race against time with conventional energy sources – often subsidised - and so-called ‘’bridge technologies’’ to compete for investment and political support. The study says energy demand in the Sunbelt is expected to grow 150 percent in the next 20 years. How that demand is met will have direct impact on efforts to control global warming and foster social development in the region.

‘’PV will be a mainstream technology by 2020 and it will become a major contributor to the electricity supply worldwide by 2030,’’ explained Adel El Gammal, EPIA secretary general, during the news conference to present the study in Brussels.

At the end of the day, cost is the name of the game, which the EPIA says photovoltaics is winning and will win decisively, Winfried Hoffmann, vice president and chief technical officer at California-based Applied Materials, told the news conference.

‘’We will be able to drive down the cost of PV kilowatt hours, ‘’Hoffmann said. ’’We have already been driving that down from 1.10 EUR twenty years ago to 20-40 cents today. That will be going down to anywhere in the range of 4 to 8 Euro cents a kilowatt in the Sunbelt region by 2030, making it one of the most cost-effective ways to produce electricity, compared with any other technology.’’

The immediate effect: for the 1.5 billion people in the Sunbelt who don’t have electricity, PV can make it possible, Gammal said. As countries have invested in mobile phones to leapfrog fixed-line telephone grids, they can also leapfrog building regional power grids by installing solar power locally.

The Sunbelt’s 148 countries are ‘’characterised by poor infrastructure resulting in high electricity costs. At the same time, due to the high solar irradiation, PV will be of course very competitive. PV is already competitive today in some of those countries with peak generation technology,’’ El Gammal said.

Driven by local and global demand, the Sunbelt could have up to 60 percent of all PV installed capacity in the world, Gammal said. At the moment, 75 percent is installed in a less-sunny Europe.

That’s why Hoffmann has a dream - to take it global: ‘’If we start to think what could happen in 40, 50 years from now, you just combine those national supergrids, or supernational supergrids to a worldwide one which would be able to meet our energy needs without any problem,’’ he said, showing a map of an interconnected world.

The EPIA has no illusions either. PV faces a tough fight to overcome sceptical investors, policymakers and consumers around the world who lack the convincing data showing the vast potential of photovoltaics. Subsidies for other energy sources, such as diesel fuel, also make it hard for PV to compete. ‘’The absence or early stage of policy support schemes still represent a significant barrier,’’ the study says.

In the Sunbelt, PV ‘’is still perceived as an expensive energy source mostly suitable for off-grid installations of small and medium size,’’ mentions the report. ‘’As a matter of fact, PV can already compete with other commonly used power generation technologies such as diesel generators.’’

One recent development may strengthen the argument for more PV. In the United States the Republicans’ election victory that put them back in power in Congress caused President Obama to abandon efforts at so-called ‘’cap and trade’’ schemes to control CO2 and ensuing global warming. ‘’There is more than one way to skin a cat,’’ Obama said after the election. One way would be to build more PV instead of more coal plants.

But the U.S., Europe and others are looking again at nuclear power at least as a bridge technology, as many plants are nearing the end of their life spans. France is launching a whole new generation of nuclear plants.

The EPIA study, using varied scenarios, aims to show the unlocked potential that could outshine conventional technologies. The most ambitious one, a ‘’paradigm shift,’’ would make China ‘’the dominant PV market in the next 20 years,’’ generating 12 percent of its power with PV. In combination with India, both countries could account for 69 percent of the overall Sunbelt potential.

The study analyses the unlocked potential in 66 out of the 148 countries in the Sunbelt, representing over 5 billion inhabitants and 95% of the region’s total population. Despite the exceptional solar irradiation registered in these countries, at present they represent only 9 percent of the global installed PV capacity.

At the same time, countries of the Sunbelt today represent about 75 percent of the world population and 40 percent of the global electricity demand. About 80 percent of the forecasted growth of the world electricity demand in the coming 20 years will originate from fast developing economies in this region.

The study shows that the PV potential of the Sunbelt countries could range, depending on the scenario(base, advanced and paradigm shift), from 60 to 250 GW by 2020, and from 260 to 1,100 GW in 2030, representing 27-58 percent of the forecasted global installed PV capacity by then. Prices of PV systems by 2030 are expected to decrease by up to 66 percent compared to their current levels.

PV electricity, already competitive today with some peak generation technologies in a number of countries, would see its generation costs dropping to a range of 6 to 12 €c / kWh by 2020, making it highly competitive with all peak generation technologies, and as low as 4 to 8 €c/kWh in 2030, making it also widely competitive with most mid-load generation technologies. PV will therefore represent a highly competitive alternative for new generation capacity as well as a replacement for existing ones.

As the study concludes, solar power would also power development in the Sunbelt, providing reliable energy supplies with low operational cost to industries today starved for electricity. It would reduce those countries’ dependence on imported energy and safeguard against spikes in fuel prices.

 



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