The Solar Power Era Has Begun

The potential of renewable energy has seemed always to be something to be realized in the future; not necessarily a distant future, but it has always seemed to be down the road a ways. It appears that while attention has been focused elsewhere, the future has arrived. Wind-generated power has been following an expected slow but inexorable path to greater contributions. Meanwhile, solar power has followed a rather different path.

Cost has always been the issue with solar power. To take hold in this country, costs of solar-generated power would have to become more competitive with traditional sources. Consequently, much research was concentrated on advanced techniques that could prove more efficient and less costly. Meanwhile, China made a big push in renewable energy and provided large sums of money to support the effort. The result was not so much new techniques, as a vast expansion in production capability for state-of-the-art solar panels. This produced a glut of product on the market that drove the prices of panels down considerably. This undercut those research efforts on more advanced techniques, which may have not been a good result, but it also changed the cost equation and made solar power more competitive and more acceptable.

For homeowners, there are plans in place where a rooftop system can be installed with little or no upfront cost. The customer essentially buys the system on time with a long-term loan and pays it off with the savings from the electricity bill. The speed with which the investment is covered by savings depends on the local cost of electricity, but terms of 4-5 years are being quoted for breakeven; and from that point on one is turning a profit from reduced energy costs and, perhaps, from excess generation capability.

What is striking is not only the potential for savings for an individual with a rooftop system, but the total amount of energy that could be generated if these systems were to become common across the nation.

A fascinating article was provided in Bloomberg Businessweek by Ken Wells. It details the potential of solar power and discusses some of the difficulties that must be overcome if that potential is to be reached.

"Over the past five years the price of photovoltaic panels has plummeted 75 percent, due largely to a glut of Chinese-made panels. The fall in prices rendered technically advanced photovoltaic panels, like those produced by Solyndra and other U.S. companies, too expensive to compete. But cheap panels have been a godsend for consumers...."

"Nationally, the average cost of residential installations—including hardware, permits, and labor—has plummeted from $9 a watt in 2006 to $5.46. Averaging in commercial industrial installations, the national installed price plummets to $3.45 a watt, says the Solar Energy Industries Association, a Washington-based trade group."

The benefits from solar installations are greater where electricity is expensive. Wells describes the situation facing one homeowner in Hawaii.

"Monthly electric bills for his modest 1,750-square-foot abode run about $400—at 32.6¢ per kilowatt hour, the highest in the nation. With his rooftop system, installed by a third-party contractor, he’ll generate enough of his own power to lower that rate to 7.3¢ per kilowatt hour for the next 20 years. That’s a savings, he says, of $120,000 over that period."

With its high energy costs, regions in Hawaii have been overwhelmed by requests for solar installation permits. This has generated resistance from stakeholders. Utility companies whose profit basis is determined by how much power they deliver have placed limits on how much consumer-generated power they will allow on their grid, claiming that the system could become unstable if limits were not imposed. Government agencies have also added viscosity and expense with complex approval processes for permits. Wells points out that since the US does not have a specific national policy in place

"....the U.S. has more than 18,000 jurisdictions at the state and local level that have a say in how rooftop solar is rolled out, according to the U.S. Department of Energy."

A procedure that could be permitted and installed in days often requires months to accomplish.

Germany has perhaps the most ambitious renewable energy plans in the world, and should serve as an example for our country.

"The hidden costs of obtaining permits and regulators’ approval to install rooftop panels is a big reason the U.S. lags behind Germany, which leads the world in rooftop installations, with more than 1 million. The price of installed rooftop solar in Germany has fallen to $2.24 per watt. In fact, on a sunny day in May, rooftop provided all of Germany’s power needs for two hours. "This is a country on latitude with Maine," says Dennis Wilson, president of the Mid-Atlantic Solar Energy Industries Association, a solar-installer trade group. ‘Germany is showing us what’s possible—if we can just get our act together’."

Other countries have also been investing heavily in solar.

"Worldwide, the picture is even more positive. Australia projects that 10 percent of its 8 million houses will have rooftop systems within the next 12 months—most of that growth coming in the past three years. European rooftop installations continue to outpace those in the U.S., even as some countries begin to pare subsidies that have helped spur a continental rooftop boom. Including residential, commercial, and industrial-scale projects, the world had installed about 67 gigawatts of photovoltaic power at the end of last year—up from just 1.5 gigawatts in 2000."

It is the ultimate potential of solar power that is so intriguing.

"Based on U.S. Census Bureau data, about 100 million U.S. residential units could physically hold rooftop systems one day, generating by one estimate 3.75 trillion kilowatt hours of electricity a year. In 2011, total U.S. electrical generation from all sources was about 4 trillion kilowatt hours...."

The current photovoltaic technology appears capable of providing nearly all of our current electricity needs if it were widely implemented. That has to be exciting to environmentalists, but perhaps not to those who earn a living building and running coal and natural gas fueled generation plants.

How this plays out could become very interesting. Clearly, whatever modifications are necessary to the electrical grid to take advantage of power sources that are variable in both time and location will have to be made. Some backup gas-powered generation will probably be required to even out the power available, but how do today’s big-time operators exist in an environment where they are merely providing a backup capability? And why would anyone still consider making the massive investments required for nuclear energy?

This is the first chapter of a long story. Many issues will arise and require attention. For now let us be comforted by the fact that a future where all or nearly all power comes from renewable sources seems attainable.