Saturday, June 11, 2011

Solar Power Costs Falling

A variety  of sources are pointing to the decline in solar costs.  See.

"GE Sees Solar Cheaper Than Fossil Power in Five Years" by Brian Wingfield Bloomberg News at on May 26, 2011
Solar power may be cheaper than electricity generated by fossil fuels and nuclear reactors within three to five years because of innovations, said Mark M. Little, the global research director for General Electric Co. (GE)  “If we can get solar at 15 cents a kilowatt-hour or lower, which I’m hopeful that we will do, you’re going to have a lot of people that are going to want to have solar at home."  The 2009 average U.S. retail rate per kilowatt-hour for electricity ranges from 6.1 cents in Wyoming to 18.1 cents in Connecticut, according to Energy Information Administration data released in April....
GE announced in April that it had boosted the efficiency of thin-film solar panels to a record 12.8 percent.... Installations may increase by as much as 50 percent in 2011, worth about $140 billion, as cheaper panels and thin film make developers less dependent on government subsidies, Bloomberg New Energy Finance forecast....The cost of solar cells, the main component in standard panels, has fallen 21 percent so far this year, and the cost of solar power is now about the same as the rate utilities charge for conventional power in the sunniest parts of California, Italy and Turkey, the London-based research company said.... Frst Solar Inc. (FSLR), based in Tempe, Arizona, is the world’s largest producer of thin-film panels, with $2.6 billion in yearly revenue.
"Solar Is Ready Now: Ferocious Cost Reductions' Make Solar PV Competitive" by Syephen Lacey at Think Progress at on June 9, 2011
According to two top solar executives – Tom Dinwoodie, CTO of SunPower and Dan Shugar, formerly of SunPower and current CEO of Solaria – “ferocious cost reductions,” are accelerating that crossover in a variety of markets today....Manufacturing costs have come down, from $60 a watt in the mid-1970’s to $1.50 today. People often point to a “Moore’s Law” in solar – meaning that for every cumulative doubling of manufacturing capacity, costs fall 20%. In solar PV manufacturing, costs have fallen about 18% for every doubling of production....The Rocky Mountain Institute projects that these costs will fall by 50% in the next five years....What has driven these cost reductions? A staggering ramp-up in installations around the world that have driven an even greater increase in solar manufacturing.... When SunPower built the 14-MW Nellis Air Force Base system in 2007, it cost $7 per watt. Today, commercial and utility systems are getting installed at around $3 per watt. In 2010 alone, the average installed cost of installing solar PV dropped 20%.

"Achieving Low-Cost Solar PV: Industry Workshop Recommendations for Near-Term Balance of System Cost Reductions" by Rocky Mountain Institute at in September, 2010
Near-term balance of system (BoS) cost-reduction recommendations developed at Rocky Mountain Institute’s Solar PV Balance of System Design Charrette4 indicate that an improvement of ~50 percent over current best practices is readily achievable. Implementing these recommendations would decrease total BoS costs to $0.60–0.90/watt for large rooftop and ground-mounted systems, and offers a pathway to bring photovoltaic electricity into the conventional electricity price range.
"Data Points: Solar’s Declining Cost Per Watt" the April 4th, 2011 txchnologist
The price of solar energy has seen a dramatic decrease, falling 35% in the last twelve years, according to data from the National Renewable Energy Laboratory’s Open PV Project.
Installed Cost by Year for Solar
In 1998, the cost per installed watt of solar was $10.87. By the end of 2010, it was close to $7. Apply that difference for a standard, 5 kilowatt home array, and you’re talking about $18,500 in savings.
Why the dramatic drop in price? Here are some key reasons:
  1. A variation on Moore’s law. Technologies, particularly those involving hardware (like solar), can rapidly increase their efficiency and decrease their costs.
  2. Rapidly declining manufacturing costs. The cost of making both silicon-based and thin-film panels have dropped rapidly in recent years. Thin film panels can be made for about $1 per watt while various silicon models are manufactured for between $1.10 and $1.80. Prices must continue to drop, however, and installation costs also have to come down.
  3. Larger scale investment. On a per-watt basis, it’s 30% cheaper to build a 25kW array than a much smaller 1 kW array. Bloomberg New Energy Finance estimates that solar investment in the last year has gone up by 49% to $85 billion, with much of that new investment going into larger arrays.
  4. Government incentives. When the government supports tax incentives for something it boosts consumer adoption, which increases scalability.
"GE: Cutting Residential Solar Costs in Half " in The April 10th, 2011 txchnologist at
Despite all of the excitement about the declining cost and increasing performance of photovoltaic solar, the nation’s homeowners have been lackadaisical about putting panels on their roofs. Last year, there were a record 40,000 residential solar installations in the U.S., but that number is a tiny fraction of the 130 million total homes in the country.  A team of engineers from General Electric, the sponsor of this magazine, want to increase the number of homes with solar roofs by halving the cost of a standard 5-kilowatt (KW) installation, which can provide about 85 percent of the average home’s electricity needs. The project, called the Smart Grid Ready Residential Solar System, partners GE Global Research and its Industrial Solutions businesses with the New York State Energy Research and Development Authority (NYSERDA). The goal is to put 10 easy-to-install, low-cost systems on roofs in Syracuse and Albany by August. Meanwhile, a similar project in San Diego — which is part of a separate program called the California Solar Initiative – has crews performing energy audits on 10 homes, in addition to the rooftop solar installations. The project is a partnership with San Diego Gas & Electric.
Both projects are the result of the engineers’ detective work into why solar is so expensive to install, said Charles Korman, the chief technologist for solar energy at GE Global Research. It isn’t the manufacturing cost of the technology: “Solar is as cheap as it’s ever been,” he said. Rather, it’s because there are so many different products available for rooftop arrays that every job is effectively a custom installation. And then there are the high labor costs. Most systems require specially trained electrical contractors to connect high-voltage systems.  The need for highly specialized labor and custom installations drives up the installed cost of solar to about $7 per watt nationwide, or roughly $35,000 for a 5 kW installation, before government incentives.

Korman wants to bring the cost down to about $21,600 or between $4 – $4.50 per watt. To achieve this goal, GE would offer a standardized kit that includes modules that output low-voltage alternating current (AC) power instead of the high-voltage direct current (DC) power of most modules. Roofers and electricians can safely install these lower voltage systems on standardized mounts, eliminating the high cost of installation. “The installations will require just the tools and skills of ordinary roofers and electrical contractors,” he said. Homeowners who participate in the new program will also receive a GE Nucleus home energy management system that displays how much electricity the array is generating, and how much appliances are using.
If the project is financed with a low-interest home equity loan, the homeowner’s electricity bill savings will more than offset the monthly loan fees, Korman said.

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