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Solar power: Sun shines on developing photovoltaic industry

 

sanlucar la mayor spain

Power play: using sunlight to generate electricity in Sanlúcar La Mayor, Spain

 

The first six months of 2013 have not been the most dazzling for the world’s solar industry.

 

First came news that solar superpower Germany was looking at paring back the generous subsidy system that has helped it build more than 32 gigawatts of installed solar photovoltaic capacity – nearly a third of the global total and more than any other country.

 

Then came bankruptcy at the main operating subsidiary of Suntech, the Chinese company that was once the world’s biggest solar panel producer.

 

Last month, it emerged that Brussels was looking at imposing duties averaging 47 per cent on Chinese solar equipment imports into the EU, in what is shaping up to be one of the bloc’s biggest trade cases.

 

At the same time, the European solar industry reported that the amount of new solar power installed in Europe fell sharply for the first time in more than a decade in 2012, in what it called a “turning point in the global PV market that will have profound implications in coming years”.

 

As growth shifts from Europe, long a champion of climate-driven energy policies, to countries with varying degrees of solar potential and the political will to exploit it, the global market’s growth remains uncertain in 2013, argues the European Photovoltaic Industry Association.

 

“The factors lined up against the continued strong growth of PV in Europe and around the world are formidable,” it said. They range from continuing economic and financial weakness to industry consolidation and regulatory instability, as governments reconsider their commitment to renewable energy sources and action on climate change.

 

Amid the gloom, however, 2013 may be a turning point of a far more optimistic kind for the still youthful solar PV industry because it also features a growing number of cases of so-called grid parity – the point at which electricity from solar PV is as cheap as conventional electric power.

 

This is something of a holy grail for the PV market, which has shot up from just 1.4 gigawatts (GW) of global installed capacity in 2000 to a record 102GW in 2012. It raises the prospect of companies finally being able to operate without relying on subsidies that have become increasingly controversial in crisis-struck Europe and remain a sensitive issue elsewhere.

 

Tumbling prices of solar equipment is one reason for the shift because they have made solar power more affordable than ever before.

 

Average PV module prices have fallen more than 80 per cent since 2008, amid a glut in supply that has caught out manufacturers such as Suntech, but opened new doors for companies supplying solar systems.

 

“The falling cost of solar is creating a lot of opportunities for unsubsidised solar,” says analyst Jenny Chase of research group Bloomberg New Energy Finance. “A lot of countries are going through a transition from high to very low or nominal subsidies. Spain is one of the first countries we are seeing build without subsidies but it’s certainly not the only place. It is also happening in Chile and the Netherlands.”

 

Spain is an obvious place for such construction, given the extent to which it has cut back on the solar subsidies that helped give it 5 per cent of global installed PV capacity.

 

The German solar system supplier, Conergy, says it has worked on 15 unsubsidised solar projects around the country since late last year. This started with an 8 kilowatt system on the roof of an organic beachside restaurant, Lasal del Varador, a few miles north of Barcelona. It has been carefully designed to match the amount of electricity the restaurant uses, meaning the owners intend to use about 95 per cent of what they generate. Conergy says that means the restaurant will hardly need any electricity from the national power grid during the day, which would otherwise cost about 15-17 euro cents per kW per hour.

 

Instead, the restaurant will be generating its own electricity at a cost of about 10 euro cents, assuming it has a lifetime of 25 years.

 

“This is the first project of its kind in Spain,” says Luis Jiménez Gutierrez, managing director of Conergy in Spain, explaining that solar is moving away from an investment-driven market towards a more traditional energy market, where the most important factors are price and availability.

 

 

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