Solar Energy’s 33 Percent Annual Growth will Accelerate

By John Addison (7/26/10)

Solar energy growth continues its strong growth. For the 30 years from 1979 to 2009, solar energy has grown 33 % CAGR (compound average growth rate). For this decade, over 40 percent is forecast. Although 2009 was hurt by a sever recession and difficulty in financing large projects, most additional power brought online in the United States, Europe, and much of Asia was renewables. 32 GW of solar power is installed globally; 7.2 GW was installed last year.

Yes, it is discouraging that U.S. electricity generation is dominated by coal and natural gas, and 97 percent of our transportation is from petroleum. The U.S. continues to spend over a trillion dollars of tax payer money each year subsidizing fossil fuels, covering health bills from pollution, and fighting wars to secure our oil supply. We suffer from our policies that support flattening mountains for coal, dangerously drilling our oceans for oil, and expanding highways instead of public transportation. Yet help is on the way as renewable energy continues to cleanly power more homes, workplaces, and rail transit. Public Transportation Renewable Energy Report

I joined 2,500 conference attendees at Intersolar North America, a premier exhibition for solar professionals. The co-located Intersolar North America and SEMICON West events, which took place this week in San Francisco, presented over 700 solar exhibitors to more than 20,000 trade visitors.

The exhibition took place at the Moscone Center, LEED certified conference center with 675 kW of solar on the roof (yes, I climbed on the roof and saw the acres of Sanyo and Shell solar panels). Equally impressive is the 80% improvement in energy efficient lighting at the conference center.

The Future is Europe buying U.S. innovation manufactured in Asia

Germany leads the world in buying most of each year’s solar production. German businesses and homeowners make money installing solar and then selling excess kilowatts with guaranteed feed-in tariffs (FIT). Although Germany is now reducing FIT rates, the cost of installing solar is dropping even faster. Germany will continue to lead in adding solar. With help from Italy and other countries, Europe will buy over 80% of solar PV in 2010. Only 6% of solar will be installed in the U.S., even though we have enough sunlight to power the entire nation.

An excellent summary of the solar market is Renewable Energy World’s Solar PV Market Analysis by Paula Mints, Navigant Consulting.

U.S. innovation has been a key driver for solar. First Solar’s CdTe thin film has brought manufacturing cost below $1.00 per watt. SunPower has achieved record 24% commercial efficiency. Key inventions of PV and semiconductors are from the U.S. Innovation continues everywhere from universities to venture backed start-ups. Optimistic presenters predicted that their technology would reach 50 cents per watt to make. Balance of system and installation costs could double or triple that number. A major issue for start-ups is difficulty in getting projects financed. Risk aversive lenders often prefer established companies who can back 20-year warranties, to start-ups with the perceived risk of staying in business 20 months. Installed PV is expected to drop from around $3 per watt today to $2 per watt in 2014.

Despite all the innovation taking place in the U.S., it is less expensive to manufacture in Asia. Navigant estimated that 77% of solar PV is made in Asia; only 5% in the U.S. Asia’s lead is likely to grow, with companies with integrated supply chains like Suntech and Sharp playing major roles.

PV growth is likely to be over 40% annually this decade. Solar is now 100X less than in the 1970s. The learning curve continues with costs falling 20% each time volume doubles. Industry leaders are squeezing out costs in everything from panels to paperwork, from inverters to mounting. Now, 95% of PV is grid connected, by 2014 it will be 97 to 99%.

By 2015, several researchers expect thin-film solar to reach about 30% of the market, but they expect silicon to continue to dominate. c-SI costs more per watt to make, but it is less expensive to install. Importantly, more efficient SI takes less space on roofs and in open areas. GTM also offers free summaries of a number of excellent solar research reports about silicon and thin-film PV.

Solar Growth Accelerates in Middle Markets

Several conference presenters examined the solar market in 4 categories:

  • Residential
  • C&I (commercial, industrial) 100 kW to 2MW
  • Utility DG (distributed e.g. commercial rooftops) 500 kW to 20 MW
  • Utility CG (central) > 20MW

Several forecast that the highest U.S. growth in the middle categories of 100 kW to 20 MW. These segments appeal to electric utilities that face RPS requirements in 30 states. Commercial distributed solar is often well matched with the location of electricity demand, minimizing transmission and distribution investment. Transit operators including LA Metro, New Jersey Transit, and MARTA are among the dozens of agencies heavily investing in solar in the 100kW to MW category. Public Transportation Renewable Energy Report

Smaller residential solar in the U.S. has been seriously injured by the wonderful companies in the middle of the recent mortgage crisis, namely Fannie Mae and Freddie Mac, who have stopped city PACE programs around the country that made residential solar affordable. If you want to laugh or cry about how the U.S. is giving the solar industry to Asia, take a look at PACE NOW.

Utilities will also continue to invest in large scale solar PV and concentrating solar power. In much of the U.S. large solar cannot compete with large-scale wind. There is 20 times as much wind power installed in the U.S. Utility-scale projects also face years of delays due to NIMBY (not-in-my-backyard) opposition to the renewable projects and the high-voltage lines needed to transmit power to major residential and industrial centers.

Intersolar Exhibitions and Conferences will take place in several locations over the next 12 months and return to San Francisco next July. In 2011, we are likely to see that solar grew strongly from rooftops to utility scale projects.

Truly impressive is solar energy’s decades of growth that exceeds 30 percent annually. Efficiency continues to improve and cost continues to fall. Energy is more secure as generation moves closer to consumption in homes, commercial centers, and transportation.

By John Addison. Publisher of the Clean Fleet Report and conference speaker.

TVA Expands Renewable Energy and Solar Charging

The smart grid charging of electric cars with renewable energy advances. The Tennessee Valley Authority (TVA), the Electric Power Research Institute (EPRI) and Oak Ridge National Laboratory Friday (ORNL) announced that they will deploy solar-assisted charging stations for electric vehicles across the state of Tennessee as part of one of the largest electric transportation projects in U.S. history.

Speaking at an event in Knoxville introducing the Nissan LEAF (NSANY), TVA Chief Executive Officer Tom Kilgore said that the first prototype charging station using solar-generated electricity will be tested at EPRI’s Laboratories for Electric Transportation Application in Knoxville this spring, possibly near the University of Tennessee campus where many electric car enthusiasts may live in multi-unit dwellings where garage charging is not available.

Modular solar charging stations can start with the charging of four cars and expand to over 10 electric cars and may be part of future fueling stations. Both stations and Nissan LEAFs will use J1772 smart charging communication.

This regional electric vehicle initiative is being done in conjunction with ETEC, which has received $100 million matching funding from DOE to install over 12,500 electric charging stations nationwide and a smart grid infrastructure.

The solar-assisted charging stations will use the sun to generate power needed to offset the charge of the electric vehicles during peak power demand periods. While vehicles are charging, the stationary batteries and smart grid controls will provide additional localized support to mitigate any impacts on the power system.

The TVA Fact Sheet also discusses re-use of automotive lithium batteries stating, “Stationary battery storage will provide additional localized grid support to mitigate the impacts of charging multiple vehicles in one centralized location. Stationary storage will also provide future opportunities to re-use automotive batteries that are no longer ideal for vehicles. These batteries may have 60 to 70 percent life left in them and can be used to support the power grid.”

Over 5 GW Renewable Energy

The Tennessee Valley Authority is moving closer to its goal of having more than 50 percent of its power generation from renewable energy by continuing to add solar and wind energy.

A power purchase agreement (PPA) with Iberdrola Renewables (IRVSF), will deliver up to 300 megawatts from the Streator Cayuga Ridge project in Illinois, starting in mid-2010. This 300MW PPA is the largest PPA to date for Iberdrola, the world leader in wind farm assets with over 10GW of wind power and 54GW of additional RE power in its pipeline.

With the new contracts, TVA has purchased up to 1,265 megawatts, enough power to serve more than 300,000 average-size homes in the Tennessee Valley. TVA’s current renewable energy portfolio now includes 5,095 megawatts from hydro, wind, solar, and methane sources. In addition, TVA’s nuclear plants contribute 6,900 megawatts of electricity.

TVA is the nation’s largest public power provider and is completely self-financing. TVA provides power to large industries and 157 power distributors that serve approximately 9 million consumers in seven southeastern states.

John Addison publishes the Clean Fleet Report and speaks at conferences.

The Other Solar Energy

by Richard T. Stuebi

Ten days ago, I attended a one-day symposium on climate change solutions at Oberlin College. Speaking at the symposium was John O’Donnell of Ausra.

Ausra is a leading player in the field of concentrating solar power (CSP), which utilizes mirrors to focus sunlight on a heating element containing a fluid to produce a steam that drives a turbine to generate electricity. In other words, solar thermal electricity – a field that was highly active in the 1980’s only to experience a 15+ year hiatus – is now coming back with a vengeance. Ausra claims that its CSP technology will soon be able to enable electricity production (in sunny desert climates, such as the southwestern U.S.) for about 8-10 cents/kwh.

Moreover, Mr. O’Donnell discussed how Ausra was working on integrating its CSP generation technology with thermal energy storage approaches, so that Ausra’s powerplants would be able to produce electricity not just when the sun is high in the sky — from 7 am to 6 pm — but over a time window more closely aligned to utility peak loads, which stretch from about 10 am to 8 pm. He made the interesting observation that thermal energy storage, using oils and molten salts, is many times more efficient and cost-effective than large-scale energy storage with batteries.

With all of the hype (much of which deserved) for solar photovoltaics (PV), it’s easy to forget about solar thermal approaches, and CSP particularly. Although not as universally applicable as PV, CSP can make a big dent in national energy supply, exploiting only a relatively small fraction of otherwise unusable desert land. In many cases, the gating factor for CSP deployment — just as has been the case for wind energy — will be the availability (or lack thereof) of transmission capacity to electricity load centers.

Mr. O’Donnell made the point that building roads in the U.S. was a local phenomenon subject to a patchwork of regulations and constraints — until President Eisenhower broke down the barriers with the creation of the Interstate Highway System in the 1950’s. He further noted that high-voltage DC technologies now readily available — such as those offered by ABB (NYSE: ABB) — could transmit large blocks of power across the whole continent with losses of only about 11% (excluding the conversion facilities at each terminal).

We in the cleantech community haven’t talked much about it, instead focusing on the sexy/cool generation/storage/consumption technologies, but maybe it’s time to ratchet the discussion about the so-called “smart grid” up to another level.

Richard T. Stuebi is the BP Fellow for Energy and Environmental Advancement at The Cleveland Foundation, and is also the Founder and President of NextWave Energy, Inc.

Stirling Performance

by Richard T. Stuebi

Last week, I visited Southeastern Ohio at the request of the office of U.S. Senator Sherrod Brown (D-OH) to be part of a roundtable discussion on how to promote cleantech and green energy innovation in a rural coal-based area. At the roundtable, I was pleased and fortunate to have met Neill Lane, President and CEO of Sunpower.

No, not the Sunpower (NASDAQ: SPWR) you probably know: the $6 billion market-cap photovoltaics subsidiary of Cypress Semiconductor (NYSE: CY) based in San Jose California.

Rather, I’m talking about Sunpower, the privately-held company based in Athens Ohio that specializes in Stirling engine technology. With much less fanfare than its same-named PV peer, Sunpower has gained a foothold in European residential micro-CHP (combined heat-and-power) markets, and is now working on modifying its technology for concentrated solar power (CSP) applications. Much of Sunpower’s technology development is done in partnership with NASA at its Glenn Research Center in Cleveland.

Sure, this Sunpower isn’t of the size and visibility of the other one. But, the company is no hype-based start-up or virtual wanna-be either, with over 60 employees (in a relatively remote college town of about 20,000 population) and a cash-flow positive position after having been in business for over 30 years. That’s a commercial success that I’d be very proud to have achieved.

Although green economy advocates mainly tout the mega-stars of the cleantech universe, they shouldn’t overlook the accomplishments of many smaller but no less innovative companies slaving away (and making money) underneath the radar screen. In rural America, there are probably many such enterprises playing important local roles in creating wealth and jobs, while addressing the global energy and environmental challenges we face. It would be nice if they could receive their due recognition too, and I dedicate this posting to these unknown soldiers.

Richard T. Stuebi is the BP Fellow for Energy and Environmental Advancement at The Cleveland Foundation, and is also the Founder and President of NextWave Energy, Inc.