"It doesn't matter how beautiful your theory is, it doesn't matter how smart you are. If it doesn't agree with experiment, it's wrong." Richard P. Feynman

Wednesday, October 12, 2011

Solar PV Power - An Unmarketable Product!


The free market is a remarkable organism where buyers determine what products are manufactured and sold and it tends to be efficient when left to it's own devices. Grist has an article stating that solar PV is becoming the cheapest way to generate electricity and they know because someone gave them a stack of un-enclosed cells and they were small. The idiots think that you can equate  KWhrs generated by solar over a few sunny hours to KWhrs consumed 24/7 by a household . Electricity generated by solar is undispatchable and therefore unsaleable and no electricity grid would buy it unless they were forced to by regulation. All the power stations are on line anyway to cater for loss of sunlight so it is hard to say that solar power is any sort of option let alone the cheapest. The writer was "baffled" by the fact that $700 dollars of silicon can produce a lifetime of household electricity but if he disconnected his solar house from the grid he would soon be "baffled " by the fact that he would not have power most of the time. He is also impressed that solar installations in Germany have dropped the feed-in tariff from TWELVE times generation cost to FOUR times generation cost for this unmarketable power which no one wants . He also thinks highly of Germany for  installing so much solar when" Germany is not very sunny" when that is the very reason Germany should not be doing it.

To unleash the power of a steep learning curve, you need a market driver when costs are still high; we should all be grateful to Germany for playing that role since the introduction of a feed-in tariff there in the year 2000.
Under the German renewable energy scheme, a family or company investing in a solar PV system receives a fixed amount per kWh of solar electricity supplied to the grid. The additional costs are distributed over all users of the grid, nationwide. Successive governments, in varying coalitions, have kept the principle alive, continuously lowering the tariffs as scale went up and cost came down. Contrary to what some believe, competition on the German PV market has always been fierce, which of course is a driving factor behind the ensuing cost (and price) reductions.
In 2004, the feed-in tariff was $0.77 per kWh. For 2012, the tariff for large, ground-based systems is already down to $0.23 per kWh, in spite of eight years of inflation. Expectations are that, even at this low tariff, between 3,500 and 5,000 megawatts of new PV capacity will be installed in Germany next year. This means that the PV supply chain and investors can earn a living at $0.23 per kWh, including operation and maintenance cost, margins, and return on capital.
But that's in Germany. The funny thing is: Germany is not very sunny! Average annual solar radiation in the sunniest parts of the country, where most PV systems are installed, is 1,000 to 1,100 kWh per 10.8 square feet, measured on a horizontal plane. The world map below shows that this is substantially less than in most of the world. In a sunnier region, like the southwestern U.S., solar radiation is double Germany's, so the same installed capacity (in watts) will produce twice as much solar electricity (in kWh). As a consequence, the cost of a solar PV kWh in Arizona is only half of the cost in Germany, i.e., already below $0.12. That's right now, without any subsidies or tax breaks.

1 comment:

  1. Interesting article about PV systems back-feeding into the grid and causing problems at http://www.theaustralian.com.au/national-affairs/carbon-plan/rooftop-solar-panels-overloading-electricity-grid/story-fn99tjf2-1226165360822