Barak Obama talking up the solar power industry

i was reading an article recently called how solar power works, which was quite informative, but it mentioned that some 41,000 homes in Australia had solar PVs on their rooves by the end of 2008, and this was expected to rise substantially by 2009. This sounded like a very small figure, and I wondered if there was more recent data. A quick search turned up a swag of articles charting the rise and rise of rooftop solar installations in recent years. The data in just about every article came from the Australian Clean Energy Regulator (ACER). Australia swept past 1 million domestic solar installations in March 2013 with solar advocates predicting a doubling, at minimum, within the following two years. That hasn’t happened, but still the take-up has been astonishing in the past six or seven years. This article from a month ago claims 1.3 million PVs, with another 170,000 systems going up annually, though it doesn’t quote sources. Others are saying that the industry is now ‘flagging’, due to the retreat of state-based subsidies, though the commercial sector is now getting in on the act, having recently tripled its share of the solar PV market to 15%. The current federal government seems unwilling to make any clear commitment to domestic solar, but the Clean Energy Finance Corp, which was established by the Gillard government, and which the Abbott government wants to axe, is now engaged in a deal with ET Solar, a Chinese company, to help finance the solarisation of shopping centres and other commercial energy users. Shopping centres, which operate all day virtually every day, would seem to be an ideal target for solar PV installation. Presumably these projects will go ahead as the Abbott government seems unable or unwilling to engage in Senate negotiations which will allow its policies, including those of axing the entities of previous governments, to progress.

There’s so much solar news around it’s hard to keep track of, but I’ll start locally, with South Australia. By the end of 2014 some 23% of SA homes had solar PV, a slight increase on the previous year. One effect has been to shift the peak power period from late afternoon to early evening (just after 7PM). South Australia leads the way with the highest proportion of panels, with Queensland close behind. Australia’s rapid adoption of rooftop solar is surpassed only by Japan. The Japanese are now voting decisively against nuclear energy with their panels.

This graph  (from the Renew Economy website) shows that on Boxing Day last year (2014) rooftop solar in SA (the big yellow peak) reached one third of demand in the middle of the day, and averaged around 30% from 11.30am to 3.30pm. With our heavy reliance on wind power here, this means that these two renewable power sources accounted for some two thirds of demand during that period. Sadly, though, with the proposed reduction of the Renewable Energy Target, wind and solar (small and large scale) are being forced to compete with each other for more limited opportunities.

There are some short-term concerns. Clearly the federal government isn’t being particularly supportive of renewables, but it’s highly likely the conservatives will be out of office after the late 2016 election, after which there may be a little more investment certainty. There’s also clear evidence now that small-scale solar uptake is declining, though it’s still happening. Profit margins for solar companies are suffering in an increasingly competitive marketplace, so large-scale, more inherently profitable projects will likely be the way of the immediate future. Still, the greater affordability of solar PV over the last few years will ensure continued uptake, and a greater proportion of households taking advantage of the technology. According to a recent International Energy Association (IEA) publication:

The cost of PV modules has been divided by five in the last six years; the cost of full PV systems has been divided by almost three. The levelised cost of electricity of decentralised solar PV systems is approaching or falling below the variable portion of retail electricity prices that system owners pay in some markets, across residential and commercial segments.

The 2014 publication was a ‘technology roadmap’, updated from 2010. Based on the unexpectedly high recent uptake of solar PV, the IEA has revised upwards its share of global electricity production from 11% to 16% by 2050. But on the barriers to expansion, the IEA’s remarks in the foreword to this document read like a warning to the Australian government

Like most renewable energy sources and energy efficiency improvements, PV is very capital-intensive: almost all expenditures are made up-front. Keeping the cost of capital low is thus of primary importance for achieving this roadmap’s vision. But investment and finance are very responsive to the quality of policy making. Clear and credible signals from policy makers lower risks and inspire confidence. By contrast, where there is a record of policy incoherence, confusing signals or stop-and-go policy cycles, investors end up paying more for their finance, consumers pay more for their energy, and some projects that are needed simply will not go ahead. 

The four-year gap between each IEA roadmap may be too long, considering the substantial changes that can occur in the energy arena. There was greater growth in solar PV capacity in the 2010-2014 period than there was in the four previous decades. The possibilities of solar energy really began to catch on with the energy crisis of the seventies, and the technology has received a boost more recently due to climate change and the lack of effective leadership on the issue. The charge was led by European countries such as Germany and Italy, but since 2013 China has been leading the pack in solar PV adoption.

What, though, of the long-term future? That’s a subject best left for another post, but clearly solar is here to stay, and its energy share will continue to expand, a continued expansion that is causing problems for industries that have traditionally (though only over the past couple of centuries actually) profited from our expanding energy needs. Our future is bound up in how we can handle transitions that will be necessary if we are to maintain energy needs with a minimum of damage to our biosphere.