Solar Technology

Solar energy remains the world’s most significant untapped, or at least barely tapped, renewable resource. The sun provides 120,000 terawatts (TW) of solar energy to Earth every year. To put this into perspective, there is an estimated 17 TW of electrical power consumed in the world each year. The most prevalent solar technology is photovoltaics (PV) solar, by which raw silicon is turned into crystalline ingots, which are then sliced into wafers. These wafers are used to make solar cells and an array of those cells goes on to form a solar module.

The next step in the chain is the system, made up of modules combined with batteries and inverters, which are then used to convert DC output into AC current for the electricity network.  Sunlight, however, is only predictable as a probability distribution, due to the natural variability in sunlight from year to year and day to day. Thus, resource assessments are required to predict the long-term potential solar resource of a site, so that solar projects are built in the correct area. This site assessment is normally undertaken over a number of months. Connection to the electricity grid and access to the site is also need to be taken into account. A system in the UK can generate 900 kilowatt-hours of electricity for every 1 kilowatt of peak capacity. There is also the problem of making solar power economic, in terms of how much of the energy captured by each system can be made usable.

The energy efficiency of the technology is typically between 16%-18%, although some firms claim solar efficiency of 20% or more for their technology. The energy efficiency of alternative solar technologies, such as thin film PV, is even lower. Due in part to the above, at the moment incentives are required to make solar competitive with other forms of energy. The industry is trying to reduce costs so that solar reaches ‘grid parity’ – the point where it costs the same or less than conventionally generated power. Then it will not be dependent on incentives. Ernst & Young believes grid parity could be reached in the UK by 2016.

Manufacturing costs are falling because of increasingly efficient production and reductions in silicon usage, while in the past year weaker than expected demand has accelerated that fall in prices. Prices are estimated to have declined by around one-fifth in the second quarter of 2011. According to British Petroleum global PV capacity increased from 23Gigawatts to 40Gigawatts in 2010. That is more than four times the size of the market in 2007 but it is not even 1% of the world energy market. Nearly all of this capacity is on-grid with off-grid capacity still a tiny percentage of the total. Nevertheless, solar research firm Solarbuzz estimates that the solar electric energy market has grown by an average of 30% a year over the past two decades. Germany accounts for 43% of global solar capacity, with the rest of Europe accounting for a further one-third of the market. Spain is the second biggest market with a capacity of 3.9GW, with Japan and Italy not far behind. Yet it is ´feed-in´ tariff incentives that have been behind the growth of solar capacity in Germany and other countries in Europe have copied the model.

However, recent reductions in incentive levels in many of these countries have caused uncertainty in many European markets, holding back further investment. The UK government, for its part, has reduced the ‘feed-in’ tariffs for solar installations larger than 50kw. That means that although there were expectations of a further 250MW in capacity to be installed this year, now it could be much less than that. Worth noting in regard to the above, the expected capacity increase is equivalent to less than that of a small coal fired power station. Lynemouth in Northumberland is one of the smallest coal-fired power stations in the UK and it has a capacity of 420MW. In Italy, the announcement that the feed-in tariffs were going to be reassessed meant that bank funding was suspended.

The tariffs for all sizes of system were reduced but the reduction was less than predicted, but there is still uncertainty about the regulatory regime. Promisingly, China is beginning to embrace solar power. This year it is expected to more than double its solar capacity, to around 2GW, according to the China-based Energy Research Institute, which also believes that China can reach grid parity by 2015. This is part of China’s strategy to reduce its dependence on coal and cut its carbon emissions. As well, India is also incentivising solar investment. It wants 60 cities to generate 10% of their power requirements from renewable, including solar.

There is even a rural electrification programme for villages which are too remote to be considered for an electricity supply. This covers more than 4,000 villages and includes more than 110MW of solar power, supporting 70,000 street lights, 360,000 home lights and 600,000 solar lanterns. On International Energy Agency estimates by 2050 the solar photovoltaic industry should represent 10.8% of the world´s energy production. Therefore, while still in its infancy, it is being called on to become one of the main sources of energy for modern Society, although regulatory uncertainties are a potential obstacle to watch out for.